B.C.sa国际传媒檚 speculation tax is bearing down on us and raising more questions: What is the rational of exempting areas with rental crises while not exempting rural areas without rental problems? Who is getting a free pass? Is this tax actually just about speculation and vacancy?
Two very similar areas are treated very differently by the NDP. Both are residential seaside communities with summer cabins and vacation homes. One is exempt and the other isnsa国际传媒檛.
Belcarra: shall I compare thee to a Lions Bay?
*Distance from Vancouver:
Belcarra 38.3 km (approx. 50-minute drive); Lions Bay 30.9 km (approx. 25-minute drive)
*Population (2016 census):
Belcarra - 643 (smallest Metro Vancouver member); Lions Bay - 1334 (3rd smallest Metro Vancouver member)
*Population density per sq. km.:
Belcarra - 116.9; Lions Bay - 526.7
*Total private dwellings (2016 census):
Belcarra - 292; Lions Bay - 547
*Number of boat-access-only properties:
Belcarra - 57; Lions Bay - none
*Commercial enterprises:
Belcarra - none; Lions Bay - two
*Metro Vancouver regional planning designation:
Belcarra - rural; Lions Bay - urban
*Rental crisis:
Belcarra - none; Lions Bay - none
*Provincial ridings:
Belcarra - NDP; Lions Bay - Liberal
Belcarra is not exempt from the speculation tax, while Lions Bay is. There has been no explanation for this anomaly other than Belcarra is, in its mayorssa国际传媒� words, sa国际传媒渃ollateral damage.sa国际传媒�
Finance Minister Carole James promised: sa国际传媒淧eople with cottages at the lake, or cabins, or on the islands, will not pay this tax. People with second homes outside of high cost urban areas will not pay the tax. Wesa国际传媒檙e going after those who are clearly taking advantage of the market and driving up prices. Wesa国际传媒檙e ensuring housing stock in our major cities is available for people who work hard and live in those cities.sa国际传媒�
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So why is a rural area without road access to 20 per cent of their dwellings targeted?
This is despite recognition that access might be an important aspect of rental accommodations: sa国际传媒淚slands that are accessible only by air or water are not part of the taxable regions.sa国际传媒� Perhaps there is a clue in Belcarra NDP MLA Rick Glumacsa国际传媒檚 alleged comment at an open house, Sept. 29: sa国际传媒淚 work hard too, but I donsa国际传媒檛 own a second house.sa国际传媒�
An examination of his public disclosure statements reveals Glumacsa国际传媒檚 spouse with investment property in Colorado, and four MLAs with investment and/or recreational property in exempt areas.
Not really very startling, except for the fact that Andrew Weaver, the Green Partysa国际传媒檚 prop to the NDPsa国际传媒檚 minority government, owns investment property in Parksville.
A cynical mind might conclude that in order to get Weaver (sa国际传媒淣ow my job is to get the NDP to recognize itsa国际传媒檚 a stupid tax and get rid of itsa国际传媒�) on board, the originally nonexempt Parksville would need to be made exempt.
A cynical mind would conclude it worked: From his blog: sa国际传媒淲e ensured that the B.C. NDP government did not fall in their declared confidence measure while at the same time working tirelessly to ensure that many of the unforeseen consequences of the poorly-thought-through speculation and vacancy tax were mitigated.sa国际传媒�
One might wonder if the mitigation came in the form of an exemption. Weaversa国际传媒檚 Parksville investment properties will increase in value. Realtors are already highlighting sa国际传媒渟pec tax exemptsa国际传媒� in their listings.
And one might wonder if the rental-accommodation-challenged Gulf Islands suddenly got their sa国际传媒渘onexemptsa国际传媒� turned into an sa国际传媒渆xemptsa国际传媒� because their MLA is Green.
How about the Juan de Fuca Electoral Area represented by John Horgan? Exempt. Granted, Langford, close to Victoria, is not included in this exemption.
But cynical minds might deduce exempting Langford and Victoria (Jamessa国际传媒� riding) would be unswallowable by the public.
Looks very bad for the premier to have his riding exempted without being seen to sacrifice something. Presto! Voila! No preferential treatment there. Except for MLAs who own property on Vancouver Islandsa国际传媒�
Out of 34 MLAs who own more than one property, 14 NDP and two Greens do so in Victoria. Four Liberal MLAs have disclosed the same. What is intriguing about this is that spouses who live apart are exempt from the tax if sa国际传媒渙ne principal residence is on Vancouver Island and the other residence is not on Vancouver Island.sa国际传媒� This directly benefits MLAs who have invested in property within commuting range of the legislature.
According to James: sa国际传媒淥nly those who hold multiple properties and leave them empty in our provincesa国际传媒檚 major cities will be asked to contribute.sa国际传媒�
Apparently not so much. If MLAs only use their Victoria properties when the legislature is sitting, their properties are empty for the majority of the year. What? But MLAs only bought their places so theysa国际传媒檇 have a place to stay in Victoria and they cansa国际传媒檛 stay in them if they rent them out! Seems a little self-interested to neatly exempt themselves from a tax they have no problem extracting from others.
Is the tax just a tricky way for the NDP to get into the property tax game?
Second homes will create a continuing stream of revenue as long as the owners donsa国际传媒檛 rent them out. As many vacation homes are uninhabitable or unrentable in cold weather, water access only, or used year-round by the owners, the revenue stream is guaranteed not to go dry.
sa国际传媒淧eople with cottages at the lake, or cabins, or on the islands, will not pay this tax.sa国际传媒� Then why is there not a blanket exemption for these places instead of a $400,000 credit? A cynical mind might conjecture a $400,000 credit can be lowered or removed in the event of government coffers running low.
Which brings us back to Belcarrasa国际传媒檚 MLA: sa国际传媒淚 work hard too, but I donsa国际传媒檛 own a second house.sa国际传媒�
A cynical mind would surmise the governmentsa国际传媒檚 intention is to eventually tax all vacation homes sa国际传媒� that second homes are fair game. Belcarra is the precedent that puts a lie to sa国际传媒淲esa国际传媒檙e going after those who are clearly taking advantage of the market and driving up prices.sa国际传媒�
The speculation tax should target foreign buyers who have done their money laundering through B.C. real estate, who have driven our prices into the stratosphere, and who are leaving vacant condos in their wake.
When it targets second properties of British Columbians, it is a wealth tax. But then again, a cynical mind would theorize that was the plan all along.
Ingrid Rice is a political cartoonist who lives in North Vancouver
