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A maximum 20-per-cent home-flipping tax is among new regulations taking effect in British Columbia as of Jan. 1, with a promised middle-income tax cut arriving in the coming months as well as a spring carbon tax increase.
Premier David Eby said Tuesday the middle-income tax cut he promised during last fall’s election campaign would help form the New Democrat government’s agenda in the new year.
“I have heard that you want our government to work harder to tackle the issues that you and your family are talking about around the kitchen table,” he said in a statement. “That is our focus for 2025 and beyond.”
Eby said during the election campaign the tax cut of up to $1,000 would initially come as a rebate in 2025, followed by the exemption of an additional $10,000 of individual income from provincial tax every year after that. That would represent a tax cut of $1,000 for households and $500 for individuals.
Statistics Canada has released new data on property flipping in B.C. As Rafferty Baker reports, the research shows that during the three years examined, flipping was a relatively small part of home sales in the province.
Opposition B.C. Conservative finance critic Peter Milobar said Eby promised immediate tax relief during the election, but people are still waiting.
“David Eby could have recalled the legislature last November to deliver the ‘immediate’ relief,’ said Milobar in a statement. “Will Eby finally deliver next February? We still don’t know.”
Eby has promised tax relief and affordability measures, but the New Democrat government is poised to implement a carbon tax increase on April 1, Milobar said.
“David Eby and Finance Minister Brenda Bailey are touting temporary cost-of-living relief while families are facing more permanent carbon tax pain in just three months,” Milobar said.
“It’s tough to see how the NDP are serious about the cost of living, when they plan to add 3.3 cents a litre to the price of gas on April 1.”
B.C.’s Finance Minister Brenda Bailey said the government is committed to helping people cope with the high living costs driven by global inflation.
“While the federal government continues to require the carbon tax, we will continue to ensure the cost for people in B.C. is offset by our climate action tax credits, worth $600 a year for the average family,” said Bailey. “We have been clear there is more to come.”
The current carbon tax on a litre of gasoline in B.C. is almost 18 cents. That is scheduled to increase to above 20 cents in April.
It’s been an eventful year for David Eby with a new mandate from B.C. voters. CBC legislative reporter Katie DeRosa sat down with the premier to reflect on 2024 and what he expects in the coming year.
20% home-flipping tax
The government’s previously announced 20-per-cent home-flipping tax, to be levied against non-exempt people who sell homes within two years of purchase, is aimed at discouraging investors “from buying housing to turn a quick profit,” said the provincial government.
Exemptions to the new tax include cases involving divorce, job loss or other changes in household membership.
B.C. has estimated that about 4,000 properties will be subject to the tax in the new year, with the revenue going toward “strengthening housing programs and building new affordable homes.”
Paul Kershaw, population professor at the University of British Columbia, tells BC Today host Michelle Eliot the tax — announced by the B.C. government as part of its 2024/2025 budget, and which will apply to homes sold two years or less after purchase — is “better late than never,” while Tony Gioventu of the Condominium Homeowners Association of B.C. says the practice of flipping has fuelled house price increases.
Opinions on the new tax have varied, with proponents saying it signals that housing should not be used for profit, while opponents say it actually will not make housing any more affordable.
Alexandra Flynn, the director of the housing research collaborative at the University of B.C., told CBC News that the tax demonstrated the government’s willingness to make difficult political decisions to address housing.
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She said that research has shown that smaller condos and properties are the ones that are usually flipped, and said the tax was one of many steps being taken by the government.
“I don’t think it’s going to solve the issue, but I do think it does address a problem that’s out there,” she said. “And this is a real problem.”
But Kim Lee, a real estate agent with Oakwyn Realty, said the tax may have unintended consequences in reducing the number of homes available for sale.
“I feel like it doesn’t address the bigger issue here,” she told CBC News. “There is still a shortage of homes right now, and this won’t make homes more affordable. In fact, I feel like it’s going to do the opposite.”
The Ministry of Finance said in a statement a new maximum annual allowable rent increase rate of three per cent also takes effect Wednesday, down from 2024’s rate of 3.5 per cent.
Other new year regulations include new rules to cut methane emissions in B.C.’s oil and gas sector, as well as a possible general property tax exemption for buyers of qualifying purpose-built rental housing.
Later in January, the province says qualifying residents should also receive payments from the quarterly climate action tax credit as well as income support that will include a temporary 25 per cent cost-of-living bonus.
Source: cbc
