B.C.'s new tax is illegal and discriminatory - academic

B.C.'s new tax is illegal and discriminatory - academic

B.C. With the new 15 per cent tax on foreign buyers of homes in British Columbia having taken effect earlier this week, fears of a mass exodus of overseas buyers to other markets have intensified due to what an academic has called a “straightforward example of discrimination in housing.”
 
In a contribution piece for The Globe and Mail, Sean Rehaag of York University’s Osgoode Hall Law School said that the recently launched tax is a patently unlawful imposition on overseas nationals.
 
“The Charter of Rights and Freedoms forbids governments from discriminating on the basis of a list of prohibited grounds, including national origin. Canadian courts have extended those prohibited grounds to include citizenship status,” Rehaag wrote.
 
“There is little question that a tax applying exclusively to a group defined by one of the Charter’s prohibited grounds would constitute discrimination.”
 
The associate professor argued that the tax is indefensible on legal grounds, and instead only crystallizes the long-running undercurrent of discrimination in British Columbia.
 
“The Charter includes a provision that renders measures lawful that would otherwise be unconstitutional if they are reasonable limits that can be justified in a free and democratic society,” Rehaag explained. “But to benefit from this provision, the government must show, among other things, that there are no other ways to achieve the intended policy objective that would do less to infringe people’s rights. It is unlikely that the B.C. government could meet this test in this case.”
 
“While the new 15-per-cent B.C. levy applies to foreign nationals, we all know the aim of the legislation is narrower: curtailing real estate investment by Chinese foreign investors. In this context, what is striking about the levy is how closely it parallels other attempts to restrict Chinese participation in the B.C. and Canadian economies,” he added.
 
Rehaag noted that the soaring demand in the country’s markets could be curbed without resorting to nationality-based measures.
 
“Some obvious ones include residency requirements, taxes on vacant property, taxes that discourage speculation and flipping, bylaws that encourage dense and diverse housing stock, and increased public investment in social housing. None of these would require unlawful discrimination,” he offered.
 
“[It] is imperative that we be cautious about policies that target people on the basis of national origin or citizenship status. The message sent by the new B.C. tax legislation – about who is welcome to participate in our economy and in our communities – matters.”
 
15 Comments
  • Tomas 2016-08-05 9:28:19 AM
    Any tears, outrage or university faculty pleas, for foreign students who pay 3x the local rate?

    He who lives in glass houses...
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  • Michael 2016-08-05 10:36:16 AM
    Tomas, while your comment is obviously an important matter as well, it does not change the fact that this 15% is in fact ILLEGAL! Foreign students coming to our universities take spots from our local children and foreign students do not pay into any of the infrastructure costs incurred in having more people here while they are going to school here and so there also needs to be some kind of an extra cost applied to them to cover all the extra infrastructure costs in our society they get to benefit from but don't pay for. But I agree 3x the costs is excessive if that is the case at some schools. This is the schools' faults however, they are taking advantage of the demand and squeezing our local children out.
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  • Tomas 2016-08-05 10:53:09 AM
    Michael,

    On what basis is the tax "illegal"?

    If that's the case then buyers can simply launch a court challenge or at minimum gain injunctive relief on the 15% transfer tax.

    You've correctly identified the 3x tuition fee issue as an attempted remedy for crowding out of local students. Is this not the same situation in the crowding out of locals in real estate?

    What if local students were required to pay the foreign student rate to win a spot in a school?
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