North Shore Liberal MLAs are blasting the NDP government’s plan to make all Metro Â鶹´«Ã½Ó³»homeowners sign a detailed declaration, proving they live in their homes, rent it out or qualify for an exemption – or be hit with the province’s new speculation and vacancy tax.
West Vancouver-Capilano MLA Ralph Sultan called it “mind-boggling” that the government is paying to send out an estimated 1.6 million letters to homeowners in qualifying areas of the province when the vast majority of them won’t end up paying the speculation tax.
He added a number of his constituents may find the forms about the new tax confusing.
“We spend a lot of time in this office helping people fill out government forms,” he said, adding many of them are elderly or not fluent in English.
North Vancouver-Seymour MLA Jane Thornthwaite is voicing similar concerns. “It’s a negative option billing situation,” she said, adding she doubts most of her constituents will be expecting to get a form from the province.
“I have a lot of seniors in my riding. I worry they’re going to think it’s something they don’t have to worry about and throw it in the recycling.”
Those who do wade through the form are likely to find it “cumbersome bureaucracy,” she said.
Starting Friday until Feb. 28, owners of residential properties in key urban areas of the province will receive letters in the mail from the province, requiring them to register to claim an exemption to the new tax by March 31 – or end up receiving a bill.
According to the province, it will take most owners between 10 and 20 minutes to fill out the form. All owners (including spouses) must fill out separate declarations.
For those who live in their homes most of the year, the process is expected to be relatively straightforward.
But there is also a long list of exemptions to the tax for which the process may be more involved. Those include owners who have recently gone into residential care, or must be away from their homes for medical reasons, those who have recently inherited the property, couples who have recently separated, as well as spouses who have to live apart for work reasons or people whose homes are uninhabitable.
North Â鶹´«Ã½Ó³»Lonsdale NDP MLA Bowinn Ma defended the tax and the way it is being put in place.
“B.C. is in a housing crisis and I was elected to take this seriously,” she said. Ma added the province knows empty homes and real estate speculation are part of the problem and the new tax was created to address that.
She said the vast majority of owners who either live in their homes or have homes that are empty for legitimate reasons that the government allows won’t have to pay the tax.
“As a homeowner myself, I'll gladly fill out a bit of paperwork to help us collectively identify vacant homes and enoucrage owners of empty housing stock to turn their properties into rentals," she said.
Ma said the fact the Liberals are “fighting against 20 minutes of paperwork shows how little effort they’re used to putting into this issue.”
The speculation tax rate for this year is a half per cent of assessed value — which equals $10,000 on a $2-million property or $15,000 on a $3-million property.
B.C. residents are eligible for a maximum tax credit of $2,000 to offset those costs.
The tax rate for Canadian citizens and permanent residents who aren't part of a "satellite family" remains the same next year.
But the tax will rise to two per cent for foreign owners and “satellite families” – defined as those who declare less than 50 per cent of their combined household income on Canadian income tax returns.
That would bring the tax for those owners on a $2-million home to $40,000 and to $60,000 on a $3-million home.
According to the provincial government, the speculation and vacancy tax is “a way to make sure these property owners are paying their fair share in taxes.”
But Sultan said it sends a message that wealthy foreign owners aren’t welcome.
In West Vancouver, “there’s no question we have a significant percentage of ownership of people who may even have permanent residency in Canada but who don’t spend all of every month of the year here,” he said. “We’re sending a great big flag saying ‘You’re not welcome. Please sell your property and get out of here.’”
Sultan said the tax also sends another message. “You might say it’s an attack on wealth generally,” he said.
He added it’s unlikely the tax will suddenly result in many empty British Properties mansions being put on the rental market.
