B.C. Real Estate Tax Witnessed A Budget Surplus

“It is clear that property transfer tax revenues are up,” de Jong said in Victoria on Thursday.

He also said that the total property transfer tax recorded by the government was $1.53 billion, which was way more the expected budget. A budget surplus of $605 million was recorded and a 44% increase compared to the previous year- so we can all say that the government had a great year.

As home sales continue to increase in Metro Vancouver, de Jong pointed out this year’s tax has been a “significant amount” higher than was predicted. Analysts believe that the release in September would also record new numbers.

“I have indicated that trend is continuing beyond the levels we thought prudent to plan for,” de Jong said.

In B.C., an additional cost (unpopular tax) is charged in the event someone buys or changes the titles on a residential or commercial property. However, exceptions can be made for qualified first-time home-buyers and some transfers within a family.

A one percent tax rate is charged on the first $200,000 and 2% on the remaining balance. However, several factors determine the costs incurred such as the fair market value of the property at the time of the transfer.

Within 2015-2016, the total value of commercial and residential real estate sold across the province was estimated to be up to $93.67 billion, wherein residential sales accounted for $79 billion and commercial sales accounted for $14 billion.

As a result, the province has been trying to figure out ways to put the money back into the economy targeted at affordability.

“Starting on Monday you will get a better sense of some of what the government believes is appropriate in terms of assisting. Clearly, we have some choices we can make due to increased revenues,” said de Jong.

“I do think we need to be conscious about making assumptions in different areas of the economy. I do think we need to be conscious that these returns will continue in perpetuity, but I don’t think they will.”