A contingent of homeowners in British Columbia is facing a tax bump on homes assessed at over $3 million – and the seniors of this group are saying that they simply can’t afford it.
Lynne Kent, 71, said that owning a home in Vancouver valued at $4 million isn’t the blessing it might appear to be.
“I think the whole property value escalation is more of an albatross than a benefit, and have seen it that way because this whole escalation is really pushing us out of our home,” Kent told The Canadian Press.
The school tax increase introduced in the B.C. budget would be set next year at 0.2% on the portion of property valued above $3 million. It would increase to 0.4% on the portion above $4 million.
For Kent and her husband – who bought their three-bedroom bungalow in the Kitsilano neighbourhood in 1972 for approximately $40,000 – that would mean an extra $2,000 annually.
As retirees, the couple lives on Canada Pension Plan and Old-Age Security payments, plus some savings. They could sell their home, and are eligible to defer both the new tax and property taxes, but Kent stressed that’s not the point.
“We raised our kids here, we have grandkids who are in university, who are part of our family life here. We hope to have great-grandkids here. It’s our home. We didn’t buy it as a money-making asset, we bought it as a home,” she said.
Kent expressed strong disagreement with the concept of deferring taxes on an ideological basis, since it means that the province is stuck with the tab in the meantime.
“We want to pay our taxes. It’s not that we don’t want to pay our taxes, but we want them to be fair,” Kent stated.
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The school tax sparked a protest last week that prompted Attorney General David Eby, who is representing many multimillion-dollar home owners in the riding of Vancouver-Point Grey, to cancel a town hall because of security concerns.
An online petition with almost 13,000 signatures characterized the tax as a cash grab on a “vulnerable minority” that disregards incomes, financial circumstances, and the ability to pay.
But Brendon Ogmundson, deputy chief economist for the British Columbia Real Estate Association, said that fears surrounding the tax have been blown out of proportion. He stated that it will be an extremely rare occurrence where an owner of a $3-million-or-higher home will not be able to afford or defer the tax.
“There’s going to be cases where it might be true, for whatever reason, that there’s a hardship. And the government should look at those cases. But in general, we’re talking about very wealthy households, whether they got there through income or the increase in their home prices,” Ogmundson explained, adding that the tax will affect fewer than 3% of homeowners in the province.
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