Finance Minister tells critics $800m funds services
Ian Bailey
Province
CAROLE TAYLOR
The B.C. government is making too much money from the property-transfer tax to consider real-estate industry requests to kill or reduce it, Finance Minister Carole Taylor says.
At best, Taylor is suggesting organizations such as the B.C. Real Estate Association, the latest to pitch reform, keep making their case leading up to next year’s B.C. budget.
B.C.’s red-hot housing market has turned the tax on home and condo sales into a moneymaker for the government worth $800 million in 2005-2006.
It’s forecast to bring in $750 million this fiscal year, declining to $725 million and $700 million through to 2009.
“Those dollars are pretty important dollars when you’re thinking about all of the requirements and needs of government,” said Taylor.
The tax has the government charging one per cent on the first $200,000 of value for a property and two per cent on the subsequent balance.
The real-estate association this week called on the B.C. Liberals to reduce or eliminate the tax, noting that its revenues since 2001 have helped balance budgets and enrich public coffers.
But Taylor said no adjustments are planned.
“I understand their reasons for wishing to not have this transfer tax,” she said. “But when you’re talking about $700 million on the budget, the minister of finance has to say, ‘If I don’t have that revenue coming in, what other spending will I cut?'” Taylor told The Province.
“We will look at it again this year and make a judgment as to whether or not it should be changed in any way, whether that’s an advisable thing to do or if it’s an affordable thing to do.”
Dave Barclay, president of the real-estate association, admitted the tax is “not a deal killer” in real-estate purchases.
“As you can see, real-estate sales are great. There’s lots of things happening. What we’re trying to do is make sure that we make things as affordable as we can.”
Jenny Kwan, finance critic for the NDP, said her party supports a review of the tax as part of a broader discussion on making home ownership more affordable in B.C.’s hot housing market.
© The Vancouver Province 2006