Yesterday’s op-ed piece by Josh Gordon in the Vancouver Sun ("Speculation tax is essential for housing affordability") should be shredded and composted across the province as potent fertilizer to the spring growing season, so pure is the horse manure contained therein. Bumper crops would be assured.
Mr. Gordon, assistant professor in the School of Public Policy at Simon Fraser University, attempts a robust defense of the tax, a wrong-headed initiative germinated in the first place by fellow luminaries at the University of B.C. It makes one wonder whether the professors have been indulging overmuch in that famous B.C. bud. A short vacation from academic haze to the real world is overdue, I think.
The initial concerns and problems with the tax “have now been addressed”, claims Mr. Gordon, before he goes on to completely ignore the disproportionate effect of the speculation levy on fellow Canadians. Out-of-province Canadians with vacation homes in B.C. will be still be on the hook for a one percent annual levy on the assessed value of their property: for a $500,000 home, that means an extra five grand in taxes, each year, every year.
With fully 81% of British Columbians in support of the speculation tax it would seem to be a smash home-run as policy, a sure-fire political winner.
Maybe. But just because something seems initially “popular” doesn’t make it right, or even popular.
It’s all in the framing, and the question put to British Columbians frames the tax, wrongly, as a “speculation” tax. As B.C. Liberal leader Andrew Weaver rightly pointed out in the legislature:
“A speculator is someone who buys a property solely to flip it. A speculator is someone who parks offshore money in our real estate, hoping to protect themselves from the turmoil in global markets. A speculator is someone who uses bare trusts to avoid paying property transfer taxes, thereby allowing multiple sales and resales with no change in title.A speculator is not someone who pays taxes here and owns a vacation cottage. These folk are not trying to capitalize on our out-of-control housing market.” Read the rest of this entry »