As readers of this column are aware,
I am not a fan of Vancouver’s Empty Homes Tax, a.k.a. the Vacancy Tax.
https://www.vancourier.com/opinion/vancouver-s-well-intentioned-but-flawed-empty-home-tax-won-t-help-1.23158200
(As you will read, I'm not a fan of the Speculation Tax either)
Although the tax was intended to address Vancouver’s housing crisis, every Vancouver homeowner is now required to submit an annual property status declaration to determine if their property is subject to the tax.
Mayor Robertson, who once naively promised to end homelessness, promised this tax could put up to 25,000 properties back on the rental market.
While I am not blind to what many consider the injustice of homes being kept empty while others have nowhere to live, I opposed this tax for many reasons. For one thing, it suddenly morphed from a vacant home tax into an “under-utilized” home tax impacting many B.C. homeowners who had legitimate reasons for owning a second home in Vancouver.
When I asked city staff why the tax should apply to these people, I was told these owners could rent out their homes when they were not living in them. A stupid and preposterous response.
In one case, we discovered the tax even applied to the owner of a vacant lot in Kerrisdale that had never been built on.
I also questioned how the program would be administered, noting the difficulties other international jurisdictions had encountered when trying to implement similar taxes. We are now getting some answers.
While for most of us Aug. 31 marks the end of summer, for some Vancouver homeowners it is a critical deadline.
It is the date by which they must submit additional information to the city’s Vacancy Tax office auditors to avoid paying the tax.
I learned about this from two Vancouver property owners, Cathy and Bill.
Cathy has lived in her house since 2004 where she raised her family. She is an active member of the Kerrisdale Community Centre and prior to the Feb. 2, 2018 deadline signed “yes, I live here” on the city’s declaration form.
She was subsequently asked to provide additional information. She suspects this may have been because the two homes beside her were empty.
On April 25, she went in person to City Hall (since privacy considerations prevent her from emailing information) and presented her B.C. driver’s licence and ICBC insurance to prove her residency. However, this was not adequate for the auditors in the Vacancy Tax office. They wrote back requesting her ICBC residential address history for 2016/2017, along with a homeowner’s insurance policy, or correspondence from a government authority regarding receipt of benefits, or a CRA Notice of Assessment, etc.
Cathy is compiling (and photocopying) all the necessary documents and will comply with the request. But she wrote to me because she’s feeling unduly harassed by the city.
Bill is also upset with the city. He claimed an exclusion from the tax since his downtown apartment, which is a second home, was being renovated. The city is now disputing whether his $100,000 renovation fits the definition of a “major renovation.” I do not know all the details of his situation. What I do know is his lawyer is now involved, and the matter may end up in the courts.
These are just two stories sent to me. But I suspect there are many others feeling harassed by vacancy office auditors.(Editor note: see below.)
The so-called Empty Homes Tax was intended to bring tens of thousands of additional rental units onto the market. But it has failed. It will no doubt generate revenues for the city; hopefully enough to cover the ever-increasing administrative costs.
But at what other costs? Longstanding Vancouver residents are feeling harassed and legal disputes are brewing.
To add insult to injury, the province has decided to bring in its so-called Speculation Tax. While many consider it a wealth tax, it too is a vacant or “under-utilized” dwelling tax. To date, we have received little information on how it will be implemented and administered.
But if Vancouver’s Empty Home Tax is any indication, the B.C. government should reconsider this ill-conceived program, if only on administrative grounds. Outside of Vancouver, it will not have much help analyzing the piles of photocopied documents to be delivered to its offices.
What a mess.
POSTSCRIPT: Since writing this column, as expected, I have been inundated with emails and tweets from people wanting to share their stories. (I have also received messages telling me to stop whining. One writer even said he was embarrassed for his SFU Alma Mater as a result of my column. He urged me to get out of my ivory tower and do something productive!) Here are a couple of things I have heard. Feel free to share others.
Michael, Just wanted to say thanks for the article.
I had a similar experience dealing with CoV and was wondering if it was just me having a particularly horrifically bad bureaucratic experience. Your article definitely provided some comfort.
Between the obvious privacy issues -- needlessly invasive initial document request, inability to email requested followup documents, inability to use the upload function on their portal, using a non-CoV telephone line/non-identification of CoV staff, only accepting followup documents in person or by registered mail and of course lost documents. It was quite comedic at times and illustrative of how poorly thought out and laughable the execution was.
All of this for a condo that has been rented out for years and has always been managed by a large well-known property management firm in Vancouver. With the documents originally supplied, one would think it should have been a pretty straightforward file to adjudicate.
From a lawyer who is very knowledgable about this matter:
Critics of this article by seem to be unaware that the audit program has design flaws that generally make it more unfair than your average CRA audit. Complainants should be listened to, not dismissed as privileged whiners.For one thing, you can’t actually speak with your auditor (you aren’t even given their name). Most other audits involve the possibility of a back-and-forth, which is often critical in getting to the right outcome.
For a more detailed discussion on the flaws, see here: