Proposed Empty Homes Tax approved to go to public consultation
City staff to seek direction on exemptions and tax rate from Vancouver residents
Today City Council took next steps on a proposed new Empty Homes Tax to help relieve pressure on the rental housing market. City staff will now move forward with public consultation to provide homeowners with the opportunity to comment on the proposed tax.
“The main goal of the Empty Homes Tax is to put homes back into the rental market, at a time when Vancouver’s dangerously low vacancy rate is putting renters in crisis,” says Mayor Gregor Robertson. “Ultimately, the City’s proposed empty homes tax will affect a very small number of people using Vancouver’s 10,000+ empty and underutilized homes as business holdings; with near-zero rental vacancy and skyrocketing house prices, the City needs to take action on bringing these empty homes back into the rental market, helping to ensure the best use of all our housing.”
All homeowners will receive a letter from the City of Vancouver shortly, with details on the tax and how to participate in the public consultation process. This consultation will include a series of open houses in Vancouver and an online survey in for homeowners who are unable to attend in person.
The City understands there are many different scenarios that may cause a home to remain empty for a long period of time. Through this consultation process we hope to learn more from the public about various situations to determine what exemptions may be appropriate.
All interested parties are encouraged to participate and can sign-up for notifications on the tax and public consultation at vancouver.ca/emptyhomes.
Facts about the proposed Empty Homes Tax:
Authority and implementation:
- The City of Vancouver was given the authority to implement this tax by the Province of British Columbia in July of 2016 through amendments to the Vancouver Charter.
- The City is seeking a tax rate that is high enough to encourage owners to rent out their empty homes.
- Due to privacy protection legislation, the City is not authorized to use data from BC Hydro to identify empty homes. Past hydro consumption data was provided on an anonymized basis only.
- Net revenues generated from this tax will be reinvested into affordable housing initiatives.
Self-declaration, audit and compliance:
- Homeowners will be required to submit a self-declaration to the City of Vancouver annually, similar to the provincial Home Owner Grant.
- The City will implement a rigorous audit program for principal residence (or exemption) declarations for the empty homes tax, in line with best practices of provincial and federal taxation authorities.
- Homeowners who do not make a declaration, or make false declarations, may either be subject to fines or penalties, or the property may be deemed vacant and subject to the tax.
- Unpaid empty homes taxes may be subject to the same consequences for non-payment as property taxes, including penalties, interest and ultimately the tax sale process.
Impacts and exemptions:
- Most homeowners in Vancouver will not be subject to the tax, including homes that were the principal residence of an owner, a long term tenant, or a permitted occupant, such as a family member, for the majority of the past year.
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The following situations have been identified as potential exemptions from the tax:
- Owner is recently deceased and estate is in probate
- Home is undergoing major renovations with permits
- Owner is in residential care with reasonable expectation of return
- Property underwent a change in ownership
- Property is in a strata subject to rental restrictions
- Owner or tenant uses home for the majority of the year for work or study purposes, but claims principal residence elsewhere