Finance Minister Carole James explains her budget measures in Victoria, Feb. 20, 2018. (Black Press files)

Rural cabins, cottages exempted from speculation tax

B.C. residents with second homes under $400,000 don’t pay

B.C.’s speculation tax on vacant homes is being restricted to urban areas, with vacation homes in rural areas exempted, Finance Minister Carole James said Monday.

The Gulf Islands, the Juan de Fuca region in Premier John Horgan’s constituency, Parksville and Qualicum Beach are being exempted, James said. The municipalities of Nanaimo, Lantzville, Abbotsford, Chilliwack and Mission will still be included, as are Metro Vancouver, Greater Victoria and the cities of Kelowna and West Kelowna.

B.C. residents also get a break on the tax rate for vacant second homes in urban areas. The tax takes effect on 2018 property value and stays at 0.5 per cent for B.C. residents with second homes.

Albertans and other Canadians whose principal residence is outside B.C. will pay 0.5 per cent the first year, rising to one per cent in 2019 and beyond. Foreign owners and “satellite families” will be the only vacant home owners charged the full two per cent that James announced in February, effective 2019.

B.C. residents with second homes that are subject to the tax will be eligible for a non-refundable tax credit that applies immediately, the finance ministry says. It offsets up to $2,000 of the new tax, meaning they will pay no speculation tax on properties up to $400,000 in value.

To be considered occupied, a home has to be rented at least six months a year in increments of one month. James said second homes in condo developments that don’t allow rentals will be temporarily exempted as well. Being rented out for three months will be sufficient for exemption in 2018 only.

James said she has heard many calls for change or repeal of the tax she announced in February, but it is needed in large urban areas to give people incentive to rent out vacant homes.

The change is designed to exempt “cottages and cabins on the lake,” James told reporters in a conference call from Vancouver.

As originally announced in the B.C. budget Feb. 20, the speculation tax would be charged to out-of-province residents who inherited a family summer or ski cabin, if it is in Metro Vancouver, the Fraser Valley, Nanaimo or Capital Regional District, or the municipalities of Kelowna and West Kelowna.

James did not comment on the effect the geographical and rate refinements would have on the expected revenue from the tax. She said it is needed to encourage more people to rent out properties that are vacant half the year or more, and to discourage speculative real estate investment.

B.C. Liberal leader Andrew Wilkinson said the NDP budget projected revenues of $200 million from the speculation tax, and now the rate is being cut for many and boundaries are being changed.

“We’re very concerned that the NDP are making up taxes by trial and error,” Wilkinson said.

Exemptions will also be considered for special circumstances such as a resident moving into long-term care or a property sitting vacant due to a death in the family, James said.

Just Posted

‘Dramatic undersupply’ of workers in Parksville Qualicum Beach: new labour report

Analysis supports what many already know, reinforces need for action: Burden

Outreach group ordered to stop feeding homeless on City of Parksville property

City issued Manna Homeless Society cease and desist order after complaints from public

Changes coming to BC Ferries reservations for Vancouver Island routes

Many customers are booking multiple reservations, inflating wait times

Discarded needles, theft from homes and businesses keep Oceanside RCMP hopping

Crime report also includes cannabis-related infraction

Police aim to prevent retaliation after Hells Angel found dead under B.C. bridge

IHIT confirms Chad Wilson, 43, was the victim of a ‘targeted’ homicide

The latest advent calendar trend: Holiday cannabis

A Canadian company is giving people from coast to coast a new way to celebrate the Christmas countdown.

B.C. woman allegedly threatens to rip out intestines of American man

A Kamloops-area woman is accused of harassing and threatening to disembowel an American man

B.C. model looks a lot like expanded taxi industry, ride-hailing group says

Ridesharing Now for BC says it had hoped the bill would be more customer-driven like in other cities

Otter makes a snack out of koi fish in Vancouver Chinese garden

Staff say the otter has eaten at least five fish

731,000 Canadians going into debt to buy prescription drugs: UBC

Millennials and those without private coverage were more likely to borrow money

Vancouver Island men ordered to pay thousands in fines following deer meat sting

The incidents happened years ago but sentencing was recently concluded.

The Vancouver Island elasmosaur needs your help

Famous Comox Valley fossil hunting for votes in chase to become BC symbol

Pot users, investors need to be vigilant at Canada-U.S. border

U.S. authorities say anyone who admits to having used pot before it became legal could be barred

Most Read