People who purchase homes without the intention of living in them have had to pay more property taxes in some regions of BC, and now the province is expanding the scope of this tax to include more Vancouver Island regions.
The speculation and vacancy tax (SVT) is meant to help rid regions, where summer homes are highly sought after, of speculative real estate practices and turn those empty houses into homes for people who live there.
The SVT will soon include the municipalities of North Cowichan, Duncan, Ladysmith, and Lake Cowichan on Vancouver Island, as well as Lions Bay and Squamish on the mainland.
“People in our province expect housing to be used as homes, not investments for speculators. The speculation and vacancy tax is making sure homes are available for people, not left empty,” said Katrine Conroy, Minister of Finance.
“That’s why we’re bringing the benefits of this tax to even more communities, to ensure more people have the homes they need.”
Next year, property owners will have to declare the usage of their homes on their taxes for the year 2023.
The province says 99.9% of people won’t have to declare for the SVT tax, but there are still around 48,000 homeowners who will have to pay.
For people looking to buy homes during the current economic climate, vacant homes are a huge barrier to them settling down in the newly designated areas.
“The people who call Duncan home know that we are facing the same housing pressures as larger centers. We need to increase supply and ensure the housing we have is used as homes,” said Michelle Staples, mayor of Duncan.
“The speculation and vacancy tax will help increase the available housing, which is badly needed.”
Exemptions are available for the SVT depending on how homeowners use the home. For example, if the home is rented out for at least six months, it will be exempt from the SVT. Additionally, if the home is the owner’s primary residence, it is also exempt.
BC states that since its implementation in 2018, the SVT has helped turn over 20,000 unused houses and condos into homes for those in need.
The tax revenue generated by the SVT will largely go towards building more affordable homes in the province and the regions where the tax was implemented.