In 2018, the Government of BC was under pressure to respond to the skyrocketing housing prices in British Columbia. Many residents found the prospect of home ownership slipping away from them as the average real estate prices increases far outstripped wage growth. In response, the government introduced the Speculation and Vacancy Tax Act (the “Speculation Tax”), with the intention that it would “turn empty homes into good housing for people who live and work in BC”. The basic idea was that the Speculation Tax would reduce profits made by those trading in real estate, which would cool the market and create a new revenue stream for the government to apply to more affordable housing initiatives. The execution has fallen somewhat short of the strategy, and the Speculation Tax has created both loopholes and (apparently) unintended consequences.
Read the full article: Guide to the BC Speculation and Vacancy Tax Act