Finance Minister Mike de Jong and Premier Christy Clark take questions on their new foreign buyer tax Monday

B.C. imposes foreign buyer tax on Metro real estate

New 15% tax imposed on non-Canadian buyers in Metro Vancouver, proceeds to a new housing fund

The B.C. government is imposing a new 15 per cent tax on property purchased in Metro Vancouver by non-Canadian citizens or residents.

The tax is to take effect Aug. 2, Finance Minister Mike de Jong told the B.C. legislature Monday at a special session called to deal with the spiralling cost of real estate in parts of urban B.C. The tax does not extend to municipalities outside Metro Vancouver, but could be amended to include those later.

De Jong said revenue from the tax will go into a new provincial fund to provide rental and social housing. Some revenues from a recent increase in B.C.’s property transfer tax on high-end homes may also be directed to the “housing priority initiatives fund,” which is being started up with $75 million in seed money from the provincial treasury.

The new 15 per cent rate on the property transfer tax will be imposed on purchases by foreign nationals and foreign controlled corporations, intended to discourage investment by non-residents.

MORE: Pundits split on whether foreign buyer tax will cool market

In the budget in February, de Jong increased the property transfer tax to three per cent on value of homes more than $2 million, and raised the exemption level to $750,000 for the purchase of new homes, in an effort to encourage new supply.

The property transfer tax continues to apply at one per cent on the first $200,000 of resold homes, and two per cent on value between $200,000 and $2 million. It has produced a windfall of revenues to the province in a hot real estate market in southern urban areas.

Premier Christy Clark said there will be more details in the coming months on how the province will use the new housing fund. She said the 15 per cent foreign buyer tax was chosen after examining similar taxes in Singapore, Hong Kong, London and Sydney.

“There is evidence now that suggests that very wealthy foreign buyers have raised the overall price of housing for British Columbia,” Clark said. “And if we are going to put British Columbians first, and that is what we are intending to do, we need to make sure that we do everything we can to try to keep housing affordable, and to try and make sure those very wealthy foreign buyers find it a little bit harder to buy a house in the Greater Vancouver area.”

NDP leader John Horgan said the province needs to use income tax data to determine whether home buyers are paying tax in Canada, rather than impose rules on foreign nationals.

“Much of the investment that’s happening now in the Lower Mainland is being directed by cash from somewhere else, by people who are already here,” Horgan said.

NDP housing critic David Eby said a foreign investor could avoid the tax by setting up a Canadian company to buy real estate.

The housing legislation introduced Monday also imposes new regulation on the B.C. real estate industry, replacing self-regulation with a new Real Estate Council appointed by the provincial cabinet.

 

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Saanich Fire Department investigating early morning fire at elementary school

Fire crews remain on scene at Strawberry Vale Elementary school

Saanich councillors scurry to ban rat poisons on municipal properties

A ‘small but important first step’ to protect local wildlife, councillor says

No swimming or skating at Juan de Fuca rec centre for now

The Q Centre to reopen starting on July 13

Sidney’s Star Cinema looks to reel in audience with reopening

It’s lights, camera, action — again — for Sidney’s Star Cinema in… Continue reading

Unemployment surpasses historic high in Greater Victoria, tourism hit hard

Hospitality and tourism sectors hurting as pandemic continues

VIDEO: Langford cat missing 18 months reunited with family

Blue the cat found at Victoria museum 17 kilometres from home

RCMP ‘disappointed’ by talk that race a factor in quiet Rideau Hall arrest

Corey Hurren, who is from Manitoba, is facing 22 charges

NHL’s Canadian hubs offer little economic benefit, but morale boost is valuable: experts

Games are slated to start Aug. 1 with six Canadian teams qualifying for the 24-team resumption of play

‘Made in the Cowichan Valley’ coming to a wine bottle near you

Cowichan Valley has the honour of being the first sub-GI outside of the Okanagan

Greater Victoria Crime Stoppers wanted list for the week of July 7

Greater Victoria Crime Stoppers is seeking the public’s help in locating the… Continue reading

POLL: Would you get a vaccine for COVID-19 when it is available?

With the number of positive COVID-19 tests skyrocketing across much of the… Continue reading

VIDEO: Alberta man rescues baby eagle believed to be drowning in East Kootenay lake

Brett Bacon was boating on a lake in Windermere when he spotted the baby eagle struggling in the water

Vancouver Island business ad unintentionally features OK gesture linked to white supremacy

Innocuous ‘OK’ gesture in cleaning franchise advertisement gets flak on social media for ‘supposedly’ promoting white supremacy

Comox Valley RCMP looking for missing woman

Ami Guthrie was last seen in Courtenay in early July

Most Read