The Vancouver city council has approved a new tax on empty homes, this is the first tax of its kind in the history of Canada.
The motion was passed with 8 in favor and 3 against. The tax means that 1 percent of a properties value must be paid for each year the home is vacant. If a home cost 100,000 dollars than roughly 1,000 dollars must be paid each year the home sits vacant. Mayor Gregor Robertson said "Vancouver's dangerously low vacancy rate is putting our renters in crisis. Our proposed empty homes tax is first and foremost about bringing rental homes back on the market".*
The plan is aimed at secondary holdings and was introduced by Robertson and Kathleen Llewellyn-Thomas, the city's general manager of community services. The exact tax rate has yet to be decided but it likely to fall in the range of 0.5 and 2.0 percent of the homes value. If you have a vacation home or are a 'snowbird' who lives only part of your year in Vancouver you are not effected and will not be taxed. Robertson says "Almost all Vancouver residents will not pay this tax, it is focused on the empty homes that are being held as businesses or effectively holding properties."
Mayor Gregor Robertson also said "Some people who can afford it will not want to rent out their properties and they are going to make a generous contribution to affordable housing in Vancouver." Homeowners will be required to report on their own whether their properties were vacant and report it on their 2017 property taxes. All Vancouver homeowners will have to declare their residence status in a process much like declaring the Home Owner Grant. This will make them exempt from paying the empty homes tax. There is a noble idea behind what the leadership of Vancouver are trying to accomplish but exactly how effective it will be remains unseen. If no declaration is made, the legislation allows for owners to be automatically charged the empty homes tax.