The British Columbia Speculation and Vacancy Tax, Canada
Set up in 2018, the British Columbia Speculation and Vacancy Tax[1] encourages the conversion of empty homes owned for speculative purposes by foreign corporations or individuals, into homes accessible for residents.
Description
It also ensures that foreign investors pay their provincial tax obligations and thereby support further affordable housing initiatives.[2] This provincial-level tax has applied to those owning residential property in specified regions, including metropolitan Vancouver, but does not relate to indigenous owners, public bodies, registered charities, housing co-ops and certain not-for-profit organizations.
The tax rate applies to relevant owners of property vacant for more than six months of the year. The rate is 2 per cent of the assessed value for all properties subject to the tax for foreign owners and satellite families[3] and 0.5 per cent for Canadian citizens or permanent residents of Canada who are not members of a satellite family.
[1] For the Speculation and Vacancy Tax Act [Sbc 2018] Chapter 46, see https://www.bclaws.ca/civix/document/id/complete/statreg/18046.
[2] The application of the tax is explained in detail on the BC Provinces official website (https://www2.gov.bc.ca/gov/content/taxes/speculation-vacancy-tax).
[3] A satellite family is an untaxed worldwide earner.
Results
In the first year of application the tax generated revenue of CAD 115 million (close to EUR 75 million) to help fund affordable housing projects where the tax is applied, of which 90 per cent came from foreign owners, satellite families and Canadians living outside of British Columbia. This has since risen to CAD 185 million (around EUR 120 million) annual revenue stream, dedicated to new affordable housing projects.
Scale
National
More information
https://www2.gov.bc.ca/gov/content/taxes/speculation-vacancy-tax
An initiative of:
