Apparently both the Liberal and NDP parties agree on something; taxes are good!
Neither party could run a government without the substantial inflow of this
insidious property transfer tax (PTT) that in Canada only British Columbians pay.
This tax was instigated by Bill Vander Zalm and his Social Credit
party back in 1987 - thanks a lot Bill. At the time the average Vancouver home cost
just $150,000. The PTT was changed recently to bring in even more
revenue to the provincial coffers. It's based on the selling price of a home every time the property is sold:
~ 1% on the first $200,000
~ 2% up to $2,000,000
~ 3% over and above $2,000,000
First time buyers are exempt from paying the PTT on properties up to $500,000, which pretty much means buying a condo or small townhouse in the outskirts of the city. So on a $1,000,000 home sale the tax is $18,000 and on a $3,000,000 sale it's $68,000 -
that's a lot of after tax money! The Provincial government estimates that it's going to bring in over $2,000,000,000 (that's $billions) throughout 2017.
One thing both the Liberals and NPD agree on is that they can't live without the revenue from this tax. The other provinces throughout Canada it seems can but not our BC government.
It's going to be interesting to see how our new minority BC government is going to function.
But one thing is certain, the PTT is here to stay along with all the other taxes that
have been imposed at the City and Provincial levels to "deal" with escalating home prices.
It is said that PTT revenue goes into "general revenue" and supposedly goes towards healthcare,education and other social services: who can argue with the benevolence of these services? Governments of all ilk love to tax and spend, that's a primary purpose of their existence it seems.
Source, CBC News April 22, 2017.