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

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

Ron MacDonnell leans over the railing on Beacon Wharf Tuesday afternoon. The Town of City is currently looking into the future of the aging structure. It could make way for a concrete pontoon once part of the floating bridge over Hood Canal in Washington State. (Wolf Depner/News Staff)
Sidney explores public-private partnership for iconic Beacon Wharf

Wharf committee recommends town invite pontoon company to submit proposal

Victoria police are seeking home surveillance video and witnesses following a prowling incident in Esquimalt Jan. 20. (Black Press Media file photo)
Esquimalt prowler removes air conditioner, peers into person’s home

VicPD is seeking video footage, witnesses following Jan. 20 incident

Francina Mettes and Thomas Schouten with the 200-page document they submitted in December of 2018. (Travis Paterson/News Staff)
Dutch 94-year-old in Saanich earns permanent Canadian residency

Couple of 45 years to stay together in Cadboro Bay

Maj.-Gen. Dany Fortin, vice-president of logistics and operations at the Public Health Agency of Canada, speaks at a news conference on the COVID-19 pandemic in Ottawa, on Friday, Jan. 15, 2021. THE CANADIAN PRESS/Justin Tang
B.C. records 500 new COVID-19 cases Wednesday, 14 deaths

Outbreak at Surrey Pretrial jail, two more in health care

Anyone with information on any of these individuals is asked to call 1-800-222-TIPS (8477) or visit the website victoriacrimestoppers.ca for more information.
Greater Victoria Crime Stoppers wanted list for the week of Jan. 19

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

Health Minister Adrian Dix looks on as Dr. Bonnie Henry pauses for a moment as she gives her daily media briefing regarding Covid-19 for the province of British Columbia in Victoria, B.C, Monday, December 7, 2020. THE CANADIAN PRESS/Jonathan Hayward
B.C. Premier, health officials to discuss next steps in COVID immunization plan

Nearly 31,000 doses of vaccine the province expected by Jan. 29 could be curtailed due to production issues

Homalco First Nation said that it will intervene in the judicial review sought by aquaculture companies with regards to federal decision to phase out 19 Discovery Island fish farms by 2022. In this picture from Sept. 24, a demonstrator wears representations of sea lice outside the Fisheries and Oceans Canada offices in downtown Vancouver.(Quinn Bender photo)
Chief says push for fish farm judicial review a challenge to reconciliation, Aboriginal Rights

Homalco First Nation chief reacts to Mowi and Cermaq intervention in Discovery Island decision

Vancouver Canucks’ Travis Hamonic grabs Montreal Canadiens’ Josh Anderson by the face during first period NHL action in Vancouver, Wednesday, Jan. 20, 2021. THE CANADIAN PRESS/Jonathan Hayward
Horvat scores winner as Canucks dump Habs 6-5 in shootout thriller

Vancouver and Montreal clash again Thursday night

Rod Bitten of Union Bay won $500,000 in the Lotto Max draw on Jan. 15. Photo supplied
Vancouver Island electrician gets shocking surprise with $500K Extra win

Rod Bitten has been hard at work with home renovations, which is… Continue reading

Eighteen-year-old Aidan Webber died in a marine accident in 2019. He was a Canadian Junior BMX champion from Nanaimo. (Submitted)
Inadequate safety training a factor in teen BMX star’s workplace death in 2019

Aidan Webber was crushed by a barge at a fish farm near Port Hardy

Most Read