Victoria really didn’t want to do anything about the housing crisis in Vancouver. As short as a month before it decided to act, the provincial government was basically denying there was a problem. But the pressure mounted, resulting in Premier Christy Clark and cabinet cobbling together a plan to charge foreign nationals an additional 15 per cent on the price of a home in Vancouver … only, although it may be extended to other municipalities. Victoria didn’t really talk to anyone about how to deal with the problem, hiding behind a quaint notion that new taxes aren’t discussed publicly before they’re introduced. I suppose they’re consistent there … remember the HST? The Liberals really didn’t want to do anything so they came up with a plan that they hoped would not alienate the real estate industry, which contributes mightily to party coffers, and still quell the uproar over tin shacks going for a million bucks in Vancouver, pricing everyone except billionaires out of the market. Hastily done, the 15 per cent tax is discriminatory, punitive, and likely to be in contravention of a whole host of trade agreements. Oh well, as long as the uproar dies down before the May election, who cares? There are better ways to deal with the problem. Rather than taxing individuals, Victoria should look at taxing usage. If we look at land use rather than ownership as a base to charge tax, the entire system becomes much fairer. And we already have the infrastructure in place to do so. I own a family farm. I inherited it when my father died 10 years ago. Twice, in the 10 years since he died, I’ve had to prove to tax collecting authorities (regional and provincial) that the property is, in fact, being used as farmland. Had I failed to prove that the property was a working farm, I would lose my farm status and be taxed at a different (much higher) rate. Why not apply the same rationale to residential properties? We already do, to some degree, with the Homeowner’s Grant, which gives those living in their own homes a small break on property taxes. People, or corporations, buying up residential properties, purely as a financial investment, and leaving them sit empty shouldn’t enjoy a residential tax rate. After all, the properties aren’t being used as residences. They’re investments. It’s a business. Those properties should be taxed as a commercial rate that government believes will curb the land rush. Investors who buy properties but rent them out, should be given a given a break, but still be taxed at a commercial property rate. That would provide some incentive for them to keep the properties occupied. If we tax the usage, then the tax applies to everyone, regardless of nationality. It’s much fairer. However, the 15 per cent tax on foreign nationals is more about optics heading into an election than actually dealing with the problem.
A fairer way to deal with the pricey housing crisis