The B.C. Government says the new speculation tax will not apply to 99 per cent of homeowners in the province.
The province made a few tweaks to the controversial tax that was announced as part of the 2018 Budget as a measure fight the out of control housing market.
The tax though drew heavy criticism from many residents and municipalities who said it unfairly taxed British Columbians with vacation homes.
Finance Minister Carole James says the housing tax will only apply to those who own multiple properties and leave them vacant in major cities.
“People with cottages at the lake, or cabins or on the islands will not pay this tax. People with second homes outside of high cost urban areas will not pay this tax. We are going after those who are clearly taking advantage of the market and driving up prices.”
That means it would apply to properties in Metro Vancouver, Kelowna, West Kelowna, Nanaimo-Lantzville, Abbotsford, Chilliwack, Mission and the Capital Regional District around Victoria on southern Vancouver Island, excluding the Gulf Islands and Juan de Fuca.
Properties with a value of $400,000 or less will also be exempt from the tax.
There’s a three-tier structure for the tax itself with foreign owners having to pay the most at two per cent of the assessed property value. Out of province landowners will be on the hook for 1 per cet. the lowest rate of 0.5 per cent for British Columbians who own multiple properties but don’t rent them at least six months of the year.
The tax expected to bring in $200 million for the province.
There are also other exemptions that will be grandfathered in because of strata rules in the urban areas that don’t allow for rental housing. The government says they are still working those details out.