Your Property Transfer Tax is going Up!!…..By approximately 2.3%. Dig Deeper Vancouverites….That home will cost you a lot more if you buy in Vancouver.
Taxpayers can expect at least a combined three per cent in hikes to property taxes and utility fees over the next five years
Almost 10 months to the day February 16, when Premier Christy Clarke hinted that Property Taxes would be cut, we have just learned that PPT are going up.
After a heated political debate that pitted the ruling Vision Vancouver against the NPA, council voted 7-4 Tuesday to raise taxes by 2.3 per cent next year to help balance a $1.2 billion operating budget.
B.C. property transfer tax could be cut, Premier Christy Clark hints
The Property Transfer tax is charged anytime someone buys or changes the titles on a residential or commercial property in B.C. Exceptions are made for qualified first-time home-buyers and some transfers within a family.
It was introduced by former Social Credit premier Bill Vander Zalm in 1987, when the average price of a Vancouver home was about $150,000, in order to tax speculation on high-end properties.
With the average home in Metro Vancouver now in the $1 million range, it can add tens of thousands of dollars to the cost of a house.
The Property Transfer Tax has generated more than $12 billion in revenue for the government since it was introduced.
The property transfer tax rate is one percent on the first $200,000 and two per cent on the remaining value, based on the fair market value of the property at the time of the transfer.
The tax hike is in addition to increases in utility fees, including 4.2 per cent for water service and 9.9 per cent for sewer. Solid waste costs remain the same.
For a single-family house assessed at $1.1 million, the increases translate to an estimated tax bill of $2,011 and another $1,198 in utility fees – solid waste ($261), sewer ($345) and water ($592) – for a total of $3,209.
That’s a spike of about $100 over this year’s bill. For a business property assessed at $589,000, the total bill comes to $5,397, an increase of about $150.
It took council more than two hours to reach a decision on the increases, largely because of an unsuccessful attempt by NPA Coun. George Affleck to defer the vote until city staff could find $7 million in savings to reduce the property transfer tax hike to 1.3 per cent. That savings, Affleck said, would keep the tax increase closer to the rate of inflation.
He did say it was the right thing to do for Vancouver Taxpayers. Maybe we should let the taxpayers decide if it is.
Will the Lower Mainland follow suit? We will just have to wait and see.
FIRST TIME HOMEBUYERS
If you’re purchasing your first home, you may qualify to reduce the amount of tax you need to pay.