Property Transfer Tax Overhaul Required. Stop Taxing the Middle Class!
Real Estate purchase & sale transaction taxation in BC would be more fair if everyone paid their share including the wealthy and big business!
In British Columbia the regular person faces an additional cost of Property Transfer Tax (PTT) on each purchase absurdly calculated at 1% of the first $200,000 and 2% on the balance. Initially introduced in 1987 by Social Credit's infamous Bill Vander Zalm as a "Luxury Tax", now those who have accumulated wealth or "Luxury" escape paying. How? If you buy property via a shell company you don't pay a dime in PTT!
Yes, There is a first time home buyer exemption if your purchase is $475K or less. A little difficult in Metro Vancouver.
$600,000 purchase price is calculated at $2,000 + 2% * $400,000 = $10,000
That's $10,000 which goes directly to the BC Provincial Government's general account. Meaning, it's a general taxation amount and not necessarily earmarked for specific uses such as transit or other roads/upgrades.
The average home price in Vancouver (West Side) is over $3M. Let's calculate how much in tax is not being paid by purchasers using a shell company.
$3M purchase price is calculated at $2,000 + 2% * $2,800,000 = $56,000
What if we ALL PAID our fair share, say 1/2 a percentage on the total purchase price and stop giving the discounts to companies. Not to mention all the multi-million dollar commercial development properties/projects also escaping this tax!
$600,000 * .5% = $3,000 $3,000,000 * .5% = $15,000
Doesn't the provincial government realize that $18,000 is more than $10,000? Fair is Fair. Collect from EVERYONE. Stop giving those with LUXURY the luxury of NOT PAYING PTT!