Vancouver Empty Homes Tax jumps to 5%

Those who have homes in Vancouver who aren’t occupied could see themselves paying significantly more after council increased the Empty Homes Tax from three per cent to five per cent.

The motion was introduced by Vancouver Mayor Kennedy Stewart as part of an ongoing effort to increase rentals in the city, which is seeing record-breaking low vacancy rates and sky-high rents.

In the motion, the mayor wrote that there was a 15 per cent decrease in vacant properties over the previous year and in 2020, the tax put $20 million back in the city’s coffers.

Big blow to housing speculators tonight! Council unanimously backed my call to strengthen the Empty Homes Tax to 5% in 2023!

Plus we’re doubling the audits to 20,000 and improving fairness.

This is how we crack down on speculators and put hardworking people first. #vanpoli

— Kennedy Stewart (@kennedystewart) April 28, 2022

The motion passed Wednesday night, however, councillors agreed to consider looking at ways the tax is implemented.

Councillor Colleen Hardwick says there are people who aren’t speculators who are being affected by the tax, including residents who may have family matters which lead them to keep a second home empty.

Staff were told to report back to council next year to find out how the program can be altered to improve fairness so that those with legitimate reasons are not penalized.

However, other councillors questioned why a second property would merit an exemption.

“I can appreciate that we currently are looking at exemptions for those with legitimate reasons for vacancy, but having a second property that kind of seems to defeat the purpose. I mean, whether the second property is here in British Columbia or a villa in Palm Springs or a dacha in Moscow,” Councillor Pete Fry said.

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Fry wants staff to look at how the large number of short-term rentals, like Airbnbs, could be reduced through the tax. He also wants to address concerns raised by staff that the larger the tax, the more the incentive would be to evade it.

Councillor Melissa De Genova asked council to consider removing the tax on vacant land, but that was stricken down and vacant unimproved residential properties that are not in the development process will still be taxed.

The city plans to double the number of audits done for the 2023 vacancy tax reference year. It notes additional staff hired to do those checks will be paid from the cost recovered from tax revenues.

Failing to declare by the deadline can result in a $250 ticket, as well as your property being deemed vacant and the tax being applied.

Payment for this year was due April 14, and the property status declaration deadline was Feb.2. The final deadline to make a late 2020 declaration is July 5, 2022.

B.C.’s Speculation Tax is in addition to Vancouver’s Empty Homes Tax, and those who own a residential property may have to pay both.