British Columbia is raising a tax it created to curb real estate speculation and ensure homes in rent-deprived communities don’t go vacant.
A statement from the Ministry of Finance said the speculation and vacancy tax now covers the municipalities of North Cowichan, Duncan, Ladysmith, Lake Cowichan, Lions Bay and Squamish.
Starting next year, homeowners in these areas will join owners in 40 other BC cities, districts and towns who must declare how their property was used in 2023.
The statement said 99 per cent of people who live in BC can expect to be exempt for the 2023 tax year, but homeowners in new municipalities, along with those already included in the tax, will face the new tax. Formal announcements will be made in the year.
Failure to make an accurate declaration can result in a fine of between one-half and two per cent of the total value of the property, depending on whether the claimant is a Canadian citizen or a foreign owner.
The tax, effective in 2018, covers most residential properties in the regional districts of Metro Vancouver and the Capital, the districts of Mission and Lentzville, and the cities of Abbotsford, Chilliwack, Kelowna, West Kelowna and Nanaimo.
The ministry said the collected funds are returned to the areas where the tax is applicable.
The statement shows that more than $313-million has been raised since 2018, with the money being used to build new, more affordable types of housing.
Finance Minister Catherine Conroy said the tax was being raised to ensure housing affordability.
“The people of our province expect houses to be used as homes, not investments for speculators,” Conroy said in the statement.
He said that speculation and vacancy tax are ensuring that houses are available for people, not left vacant.
Ministry figures show the move helped convert about 20,000 vacant condos into homes in Metro Vancouver, and it says the tax extension is expected to bring more homes to those communities. are struggling with low vacancy rates.