Response Letter Minister Carol James

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From: Minister, FIN FIN:EX <FIN.Minister@gov.bc.ca> 
Sent: Tuesday, April 17, 2018 9:25 AM 
To: Jas Chonk 
Subject: FW: Letter from Islands Trust Council Chair re proposed speculation tax 
Attachments: 1804 Letter to Minister James re proposed speculation tax.pdf 
 
 
 
Thank you for your message regarding the speculation tax announced in Budget 2018. 
 
British Columbia is facing a serious housing crisis.   Dramatic rises in housing prices and near zero 
vacancy rates in our cities are limiting people’s ability to find a home. These challenges are also 
restricting businesses’ ability to attract and retain employees. 
 
The government of B.C. is committed to taking action to deal with the housing affordability crisis. This is 
why we have developed a 30-point housing plan that invests over $6 billion to increase housing supply 
and boost rental assistance programs, and introduces a number of measures to improve affordability and 
moderate demand.  
 
One part of the plan to address the housing crisis is a speculation tax on residential property.  The tax 
targets foreign and domestic owners who are holding their properties vacant and taking housing stock out 
of the rental pool in urban areas. The tax also targets satellite families who do not pay their share of 
income taxes in our province, but enjoy B.C.’s services and high quality of life.  
 
Over 99 per cent of British Columbians will not pay the tax.   
 
The government recently announced a number of implementation details of the speculation tax, including: 
 
 Geographic description of the areas where the tax will apply: 
o Metro Vancouver (excluding Bowen Island and Electoral Area A, except the part of the 
electoral area that is the UBC and University Endowment Lands), the Capital Regional 
District (excluding the Gulf Islands and Juan de Fuca), Kelowna, West Kelowna, 
Nanaimo-Lantzville (excluding Protection Island),  Abbotsford, Chilliwack (excluding 
Cultus Lake), and Mission.  Most islands are excluded. 
 Exemptions for British Columbians’ primary residences. 
 Exemptions for British Columbians’ vacant second homes up to a value of $400,000. 
 Exemptions for qualifying long-term rentals, defined as: 
o In 2018, a property that is rented out for three months of that year in increments of 30 
days. 
o In 2019 and beyond, a long-term rental is a property that is rented out for at least six 
months out of the calendar year in increments of at least 30 consecutive days.  
 The tax rate in 2018 is set at 0.5% of a taxable property’s value. In 2019 and subsequent years, 
the tax rates will be as follows: 
o 2% for foreign investors and satellite families; 
o 1% for Canadian citizens and permanent residents who do not live in British Columbia; 
and 
o 0.5% for British Columbians who are Canadian citizens or permanent residents (and not 
members of a satellite family). 

Full legislation for the speculation tax will be introduced in the fall of 2018. 
 
Our government has a responsibil

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