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The BC government raised less money from the speculation and vacancy tax in 2021 than it did in 2020.
More than $78 million was raised last year through the tax on empty properties, but that’s down from $81 million the year before.
Foreign owners and satellite families continue to pay the majority of the tax, with a total of $44.4 million, or almost 57% of total SVT revenues in 2021.
The number of British Columbians paying the SVT in 2021 decreased by 4.3% compared to the 2020 tax year.
In Kelowna, the tax generated $3.23 million. The vast majority of residential property owners listed their homes as principal residences in Kelowna in 2021, while 19,514 were being rented.
Canadians from other provinces accounted for 3,718 of the 72,697 residential properties in the city. Foreign owners accounted for just 242 of the properties.
Breaking down the 2021 revenue by owner type in Kelowna; BC residents accounted for $914,000, other Canadians $1.4 million, foreign owners $152,000, satellite family $514,000 and ‘other’ made up $250,000 of the total.
The government says analysis of the 2021 data shows the tax continues to encourage people to use their residential properties as their homes or as rentals. As a result, between 2020 and 2021, nearly 26,000 additional property owners claimed the principal residence exemption because the unit was no longer vacant. This number suggests the SVT is changing property-owner behavior and increasing long-term housing.
The province says it has reinvested $1.1 billion in communities that collect the tax, which is intended to support affordable housing.
However, former Kelowna Mayor Colin Basran was outspoken in his concerns that the levy wasn’t having the desired effect in the Central Okanagan.
In a January 2021 letter to finance minister Selina Robinson, Basran argued that two key objectives of the tax, tempering rising house prices and increasing the rental supply, are not being met in a meaningful way in the city.
Since then, the rental vacancy rate in Kelowna has dropped to 0.6% this year.
The BC government is expanding the SVT in 2023 to include North Cowichan, Duncan, Ladysmith, Lake Cowichan, Lions Bay and Squamish.
“It’s not just the larger urban areas like Vancouver and Victoria that are facing a housing crisis. In smaller and medium-sized communities like North Cowichan, people are struggling with housing affordability,” said Rob Douglas, mayor of North Cowichan. “We are glad to see the Province expand the speculation and vacancy tax to our community and look forward to seeing the revenue collected from this tax invested in affordable housing projects in our region.”
