Kelowna mayor says B.C.'s speculation tax could have 'dire unintended consequences'
Finance minister says B.C.-wide tax needed or speculators will move around province
Kelowna Mayor Colin Basran says he wishes the province had consulted him or even provided a warning about the new speculation tax the B.C. government announced in its 2018 budget.
"It would have been nice," Basran said, adding the lack of notice and consultation on the new measure caused fears in his community and he wants answers.
"What we're hearing right now in the community is there's a lot of concern," he said. "This may have some very dire unintended consequences.
"We need to take some time and make sure we get this right."
Basran says those concerns are loudest from the business community and out-of-towners who have bought property in Kelowna.
They're worried about "disastrous" impacts on the local economy from what Basran says is more like an empty homes tax "which is potentially going to stop people from investing in our economy."
What about student housing?
Basran, who was a realtor before he became mayor in 2014, said many low- and medium-income earners in Kelowna have found it nearly impossible to get into the local housing market.
And while he admits the status quo isn't ideal, he thinks the tax is the wrong way to go.
For example, many students rent houses from landlords who live outside the province. He said some of those homeowners might be subject to the new tax, but it's not clear.
"There's a lot of uncertainty."
Finance Minister Carole James, in a statement, said the government must take action to address "rampant" speculation that has put home prices out of reach for many.
James said by applying the speculation tax to major urban centres throughout B.C., the government won't simply be driving speculators out of one community and into another.
"We want the tax system to be fair for the people that live, work and pay taxes here," she said in the statement.
As for the lack of consultation, James said "it is standard practice for the province to develop tax policies independently and confidentially."
Basran says Kelowna city council is gathering information and holding meetings with the business community to find a way to "tweak" or find alternatives to the tax for his city.