Action needed on B.C. property transfer tax

When knocking on doors in Vancouver-Fraserview, the B.C. Conservative candidate talks about one other thing aside from typical issues like education and health care: the property transfer tax. Even though his party hasn’t taken a stand on the levy, Pandey tells voters that he wants to see this tax reduced.

“As a realtor, I’m totally opposed to it,” Pandey told the Georgia Straight in a phone interview.

The Real Estate Board of Greater Vancouver has also identified the reduction of the B.C. property transfer tax as its top issue in the May 14 provincial election.

Introduced in 1987 by the government of the day as a form of a wealth tax, it’s a one percent levy on the first $200,000 of the purchase price, and two percent on the balance of the transaction.

But according to REBGV president Sandra Wyant, 1987 was a long time ago. “And that’s what makes the tax so unfair,” Wyant told the Straight by phone.

She recalled that the property transfer tax was implemented at a time when only five percent of homes in the Greater Vancouver area were selling for $200,000 or more. Today, 96 percent of residential properties in the region are priced higher than $200,000.

The REBGV is proposing an increase of the one percent threshold to $525,000. According to the association, this would mean that the new property transfer tax on a $600,000 home would be $6,750. This will save homebuyers $3,250.

The REBGV also notes that the tax generated $780 million in fiscal year 2012-13. For the last 26 years, the levy has brought into government coffers revenues totalling $11.9 billion.

So far, the association’s campaign to reduce the property transfer tax has attracted the support of only four candidates, including Pandey. Out of the four, three are realtors.

“Four is a start and we still have a couple of weeks to go,” Wyant said.

She also noted that her association has sent letters to the major political parties and has yet to hear from any of them as April 30. “Realtors never give up,” Wyant said when asked if she’s discouraged.

Pandey has also written his B.C. Conservative Party about the issue and hasn’t heard back. This hasn’t discouraged the first-time candidate from talking about it on the campaign trail.

Pandey also has a quick answer to the question of how the province will raise money to cover the difference if it adjusts the property transfer tax: “The government has so much money, so much wastage. We have tons of money that we could reduce the property transfer tax, and still run the business.”