Bill 28 (British Columbia)
Bill 28, the Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act, 2016, is a British Columbian law that came into force on August 2, 2016. The law was introduced after calls urging the British Columbia (BC) provincial government to intervene in the housing market and curb foreign investment that was seen as a major contributor to the rapid rise in home prices.
The Act has four parts:
- Vacancy tax: Amendments to the vacancy taxon vacant residential property
- Foreign-buyers tax: Amendments to the residential propertypurchased by foreign buyers
- Amendments to the Real Estate Services Act discontinuing real estate industry
- Creating a new Housing Priority Initiatives special account to fund initiatives in respect to housing, rental, access, and support programs with the new tax revenues resulting from this law.[1]
History
In 2016 Vancouver's housing was the third most unaffordable in the English-speaking world, with a ratio of real estate prices to local earnings of 13 to one.[2]
Vancouver locals had been complaining for a long time about foreign citizens purchasing homes and displacing residents who find housing has become unaffordable and may end up being homeless. There was also a concern expressed that housing purchased by foreign citizens stays vacant. So, on Aug 2, 2016, the British Columbia government introduced Bill 28.[3]
The act was introduced as a surprise move by the Liberal
Aftermath
According to
According to The Province, in 2016 Vancouver residential prices moved up 18 per cent overall, according to the Real Estate Board of Greater Vancouver, but cooled off just before the province imposed a 15 per cent foreign buyers tax in August. Towards the end of the year falling sales, and in some cases prices, dominated the housing market.[9]
According to The Province, two Victoria city councillors, Ben Isitt and Jeremy Loveday, wanted the foreign buyers tax also applied in the capital region. In addition, they wanted local municipalities to be given the authority to impose a tax on vacant properties.[10]
In 2018, the Foreign Buyer's Tax was extended to the Fraser Valley, Capital, Nanaimo, and Central Okanagan Regional Districts, at 20 percent.[11]
Speculation and vacancy tax
The
Foreign-buyers tax
A new 20/15 percent tax was added to the
Government figures showed that foreign citizens, mainly Chinese, have purchased $1 billion worth of real estate in British Columbia during a five-week period in 2016. When the tax was introduced, Premier of British Columbia Christy Clark said: "There is evidence now that suggests that very wealthy foreign buyers have raised the price, the overall price of housing for people in British Columbia". Foreign buyers were blamed by Tom Davidoff of the University of British Columbia (UBC) for large increases in real estate prices experienced in Vancouver. According to David Ley, also of UBC, taxing foreign citizens has slowed down rapid real estate appreciation in other countries.[15]
Real Estate Services Act
The Real Estate Services Act was amended to end self-regulation of the real estate industry in British Columbia.[16]
Housing Priority Initiatives special account
The Housing Priority Initiatives special account was created to hold the new tax revenues created by this law to fund initiatives in respect of homes rentals, access, and support programs. On September 14, 2016, The Province reported that the housing affordability plan would launch with almost half a billion dollars from
On September 16, 2016,
See also
- Chinese interest in real estate in the United Kingdom
- Foreign investment in residential property(Australia)
- Foreign Investment in Real Property Tax Act (United States)
- Foreign Investment and National Security Act of 2007 (United States)
References
- ^ Chisholm, McMillan LLP-Damon; Kuehn, Scott. "BC Government Targets Foreign Buyers with Massive Tax Hike - Lexology".
- ^ "Douglas Todd: Vancouver's contentious housing crisis exploded in 2016". 31 December 2016.
- ^ "Runner Run-Down: B.C.'s New Property Transfer Tax".
- ^ "Bill 28 – 2016: Miscellaneous Statutes (Housing Priority Initiatives) Amendment Act, 2016".
- ^ "B.C. housing tax drives down foreign buying in Vancouver - Article - BNN". 29 November 2016.
- ^ Dmitrieva, Katia. "Vancouver Tax Pushes Chinese to $1 Million Seattle Homes". Bloomberg.com. Bloomberg. Retrieved 3 May 2017.
- ^ "The upsides of B.C.'s foreign-buyer tax outweigh its downsides".
- ^ Bula, Frances (15 December 2016). "Despite rising home prices, millennials intent on staying in Vancouver region". The Globe and Mail.
- ^ "The Province ePaper".
- ^ Cleverley, Bill. "Extend foreign buyer home tax to capital region, two Victoria councillors urge".
- ^ "Additional Property Transfer Tax for Foreign Entities & Taxable Trustees". Government of BC.
- ^ "Speculation and Vacancy Tax". Retrieved 2019-05-11.
- ^ "Can Gregor Roberton's vacancy tax make Vancouver affordable?".
- ^ Bula, Frances (23 April 2018). "Vancouver's empty-homes tax to rake in $30-million in first year; many properties exempted". The Globe and Mail. Retrieved 23 April 2018.
- ^ "Foreign buyers to face tax hike on Metro Vancouver real estate". 26 July 2016.
- ^ Tomlinson, Kathy (29 June 2016). "B.C. puts end to real estate self-regulation". The Globe and Mail.
- ^ Shaw, Rob. "B.C. opens coffers for a new housing affordability plan, puts $500 million on table".
- ^ MacLeod, Andrew (16 September 2016). "Bulging with New Cash, BC Liberals Eye Spending Spree into Election - The Tyee".