Editorial: Punishing Speculation Tax

Editorial

Tuesday, March 6 2018

So far, the so-called Speculation Tax looks to be a tax formed by politicians, and not those who will have to administer it.

The premise appears to be that those who are able to own property in more than one location should pay an extra tax. Somehow this is expected to keep the price of homes down.

It may work, in the short run.

But in the end, those with enough money will own the property they want; those without the money will not.

The worst part about this tax is there is a lot of “details to come” coming out of Victoria.

Three  ‘facts’ have been released by the Ministry of Finance.

• The new speculation tax is intended to help deter people from treating B.C.’s housing market like the stock market.

• The tax will target foreign and domestic speculators driving up prices and those who are taking critical rental stock out of the market.

• Up-front exemptions will be available for principal residences and people that put their homes in the long-term rental market. (no definition of long-term has been released yet...)

This is not going to bode well for communities outside the major municipalities. Supposedly we in the RDN are being included because when Greater Victoria and Metro Vancouver put in a housing ‘control’ that pushes buyers into the Nanaimo area.

But in our community, some of the homes are purchased in advance of people wanting to retire here. People who, as we see time and again, become valuable additions to our island community.

Some of those homes are rented out, and allow people to live here who otherwise wouldn’t be able to afford to. Again, we don’t know what long term will mean in the details.

It’s one thing to try and slow down speculation. 

Perhaps what the NDP should have done is put in a tax on how fast a home is bought and sold. If the time between purchase and sale is short, counted in months, a large tax is paid. In years, smaller tax. Decades? No tax.

But this punishes some of those who purchased their piece of BC back when most of the current crop of MLAs were still in high school.