Seniors face ‘unaffordable’ $2,000 tax increase on their $4M home
Lynne Kent doesn’t feel “blessed” to own her home in Vancouver, which has been steadily increasing in value over the last few decades.
Lynne and her husband are part of a small group of British Columbia homeowners facing a tax increase on homes valued over $3 million. Most are saying they “simply can’t afford it” while others are questioning that claim.
“I think the whole property value escalation is more of an albatross than a benefit, and [we] have seen it that way because this whole escalation is really pushing us out of our home,” said 71-year-old Lynne.
A school tax increase that was introduced in B.C.’s budget is set to go into effect next year. For homes valued above $3 million there will be a 0.2 percent tax and for those valued above $4 million the tax rises to 0.4 percent.
For the Kents, this tax jump equates to an extra $2,000 annually.
As for the house, the Kents bought it in the early 70s for around $40,000. The Kitsilano neighbourhood is near the water, and they renovated the home in 1982 themselves.
The couple is retired and live on “Canada Pension Plan and Old-Age Security payments, plus some savings.”
They have the options of selling their home, and are eligible to defer the property taxes and new taxes going into effect, but Lynne says, “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.”
Ideologically, Lynne disagrees with the concept of deferring taxes that someone else (the province) will have to cover anyway. The Kents want to pay their taxes, but they want to pay fair taxes.
“The school tax sparked a protest last week that prompted Attorney General David Eby, who represents many multimillion-dollar home owners in the riding of Vancouver-Point Grey, to cancel a town hall because of security concerns” said Financial Post.
An online petition collected nearly 13,000 signatures and claim that the new tax is a cash-grab aimed at a “vulnerable minority” without considering who they are, what their incomes may be, or how they are able to pay.
Brendon Ogmundson, economist for B.C.’s Real Estate Association, thinks it will be rare to find someone who owns a house valued at $3 to $4 million who can neither “afford the tax nor defer it,” he said.
Ogmundson believes that there should be some consideration to people in particular financial circumstances, but in general, he knows that these are wealthy households who are able to own these homes due to income or increased home values.
This new tax is set to affect fewer than three percent of all homeowners in the province.