Ad warning homeowners to sell before tax kicks in fails
Kevin Griffin
The Province
A Victoria realtor who wants people to sell their homes now, in order to avoid a proposed NDP speculation tax that would come into effect this taxation year, said he’s had a tepid response so far.
Ron Bahrey said he’s only received “a couple of calls” since an ad appeared in the Times Colonist on Wednesday.
“I thought I’d get more calls,” Bahrey said in a phone interview Thursday.
“It hasn’t turned out the way I thought it would.”
The ad included a photo of the realtor along with the following text and his phone number: “Sell now and avoid the new B.C. ‘Speculation Tax’ Get top dollar for your Home or Investment property.”
Bahrey, a realtor since 1983, said he was basing his expected response on the number of online comments to various stories about public reaction to the speculation tax, including Vaughn Palmer’s columns in The Vancouver Sun.
“I know there are lots of people upset,” he said.
A friend suggested that maybe Bahrey’s ad appeared too soon. The friend said he might receive more calls should it become law later this year.
Bahrey said he was personally against the proposed tax, which he described as oppressive and punitive.
“It’s a terrible tax on Albertans and people who live in Canada who have come here to retire,” he said.
Bahrey cited as an example an older physician from Alberta who bought a condo in Oak Bay for around $250,000 about 20 years ago. He expects the property’s value has increased to $350,000.
Homeowners such as the physician in Oak Bay, Bahrey said, constitute the bulk of his clients.
“They never bought that for speculation,” he said. “They bought it for use when they come from Calgary.”
Bahrey said he didn’t have a problem with people speculating on property.
“I think people should be allowed to speculate,” he said.
“They’re still being taxed on everything they do.”
The provincial government, in its February budget, proposed a new speculation tax to target absentee investor homeowners who declared little or no income in B.C. The tax would be based on assessed value: $5 per $1,000 of assessed value this year, rising to $20 in 2019.
The tax would be effective for the 2018 taxation year.
A Ministry of Finance tax information sheet says that principle residences and homes rented out for the long term will be exempt.
“A non-refundable income tax credit will help offset the tax for B.C. residents,” it says.
“This will leave the bulk of the tax levied on vacant and short-term properties owned by individuals who do not live in B.C., as well as satellite families.”
The information sheet defines satellite families as households with high worldwide income that pay little income tax in B.C.
In the budget, the province also proposed to increase the foreign buyers tax to 20 per cent from 15 per cent and expand the levy to Victoria, Nanaimo, the Fraser Valley and Kelowna.
Both measures would generate an expected $602 million in revenue for the provincial government by 2021.
The foreign buyers tax was introduced in August 2016 by then-premier Christy Clark.
The Real Estate Council of B.C., the provincial regulator of realtors, said in an email that its advice to consumers and real estate professionals “is to obtain independent legal or accounting advice about how any applicable tax may affect their real estate transaction.”
For more information, the council directed the public to the Ministry of Finance and its Tax Information Sheet about the proposed speculation tax.
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