Learn more about: The “BC Speculation Tax” on the Ground with Randy Trapp
B.C.’s proposed speculation tax for owners of resort properties is well intended but if it goes ahead in its current framework it could hurt tourist-reliant communities and be punitive to long-term residents, says a B.C. resort developer/builder.
While the proposed tax aims to target foreign and out-of-province investors who do not pay income tax in B.C. – and it includes owners who leave homes vacant – it could unfairly affect some B.C. residents who have owned second homes for many years, says Randy Trapp, president and CEO of Luxury Resorts West, a B.C. resort developer/builder.
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In its current state, the tax, which would be in place next year, will only apply to B.C. owners of second homes assessed at more than $400,000 in Metro Vancouver, The Capital Regional District (Victoria and surrounding communities), Kelowna and West Kelowna, Nanaimo and parts of the Fraser Valley, including Abbotsford and Chilliwack.
Trapp says he doesn’t disagree with what the government is trying to accomplish. A speculation tax makes sense in downtown Vancouver and Victoria markets, for example, where presales are driving up prices, creating an “artificially inflated market,” making homes unaffordable for many full-time residents, he says.