First year results are in and West Kelowna wants out of speculation tax
'There's many negative impacts,' says the mayor
B.C.'s finance minister may be touting the success of the speculation tax, but not all of the mayors in affected cities are on board.
The tax brought in over $115 million in 2018 and Finance Minister Carole James announced that the government is projecting revenue of $185 million in 2019/20 from the tax.
However, at a meeting with affected municipalities on Thursday, the mayor of West Kelowna made it clear the city still wants out.
"We told her straight off that the City of West Kelowna strongly supports the removal of our municipality from the speculation tax," said Mayor Gord Milsom.
West Kelowna received just over $1 million in revenue from the 2018 speculation and vacancy tax, which was set at 0.5 per cent of the assessed value of a property in 2018 — and will rise to two per cent for foreign owners and satellite families this year.
"We're concerned about, you know, who the tax impacts," said Milsom. Numbers in a report released by the province show that 73 residences that were not exempt from the tax were owned by out-of-province Canadians. Sixty residences were owned by B.C. residents. Six were owned by foreign owners and 15 by satellite families.
"We don't have very many foreign owners. We don't have very many satellite families. So, it impacted primarily British Columbians and out-of-province owners," said Milsom.
"So, Canadians who have been a big part of our community for many, many years, they pay property tax, been good citizens. They supported our local economy. These are the people within West Kelowna that have been impacted, and I don't think that's fair that they should have been."
In the case of cities like Victoria and Vancouver it's the opposite, where the number of residences owned by foreign owners that weren't exempt from the tax is much higher than those owned by B.C. residents or other Canadians.
"Some larger taxable areas like Vancouver, Victoria, were actually supportive of the tax for their own reasons, you know, because of the lack of affordability in their communities and tax rate and so on," he said.
"I would say about 75 per cent of the municipalities that were at the meeting also expressed a desire to opt out."
Money for affordable housing
The finance minister has said that the money from the tax is designed to help fund more affordable housing.
Milsom said it is his understanding the money will be given to the Central Okanagan region to add to the funds B.C. Housing is putting toward affordable housing in the area.
"Certainly in West Kelowna we do have needs for more non-market rental housing for low income individuals, families and seniors and also transitional housing for the homeless," he told Daybreak South host Chris Walker.
"I mean the $1 million we certainly appreciate that and to be able to put those monies to good use, but when you look at the other, you know, negative impacts to the community, I really don't think the value is there."
The West Kelowna mayor said there has been "many negative impacts" on the community, primarily in the construction industry.
The Canadian Home Builders Association estimates a 17 per cent reduction in jobs in West Kelowna in 2018 since the tax was implemented, he said.
"Primarily, most of that money has been collected from B.C.ers and from out-of-province Canadians, and I don't think they appreciate being treated that way," said Milsom.
He added the finance minister said she would consider his and the other mayors' concerns and get back to them later this fall.
With files from Daybreak South