Foreign Buyers’ Tax: What is it and how has it changed?

The original foreign buyers tax was brought into effect on August 2^nd, 2016. It was introduced by the B.C government to impose a 15% tax on foreign buyers purchasing Metro Vancouver properties. The aim for the tax was to alleviate the housing affordability crisis by driving prices up for foreign buyers to decrease demand and speculation. With Vancouver was once again placing third for being the least affordable city in the world (for the sixth consecutive year), behind Hong Kong and Sydney. Reports have stated that the prices of housing in Vancouver did cool down slightly after the original foreign buyers’ tax, but did not prove to be a permanent solution.

However, changes to the foreign buyers’ tax was made on February 21^st, 2018. It is now 20% and includes areas outside of Metro Vancouver: Fraser Valley, Okanagan, Kamloops, Greater Victoria and Nanaimo Regional District. Justification for the expansion of for the tax is so that speculation is not passed onto bordering markets.

Source(s)

https://www.ctvnews.ca/business/expansion-of-b-c-foreign-buyers-tax-to-okanagan-vancouver-island-is-questioned-1.3815515

http://bcbudget.gov.bc.ca/2018/default.htm

http://business.financialpost.com/real-estate/b-c-unveils-housing-plan-that-raises-foreign-buyers-levy-and-taxes-speculators