Things just got a little harder for foreign nationals and non-residents hoping to purchase real estate in Canada’s pacific coast province. On Wednesday, Vancouver implemented a 20% levy on the market value of real estate transactions made by foreign buyers, up from 15%.
The levy comes among other measures that crack down on foreign buyers exploiting taxation loopholes.
For instance, it is an increasingly common occurrence for buyers to declare poverty level income, while purchasing properties in some of the province’s wealthiest neighborhoods. In response, the CRA will now request buyers to declare all foreign assets, adhering to a much stricter verification process.
The government is also trying to implement a closer watch on the pre-sale condo market, targeting flippers who fail to declare gains on their short term investments. This measure ensures that offshore trusts and hidden investors are paying due taxes on their real estate gains.
In addition, budget documents released on Tuesday state that a levy on property speculators will be introduced later this year.
According to British Columbia’s Finance Minister, Carole James, these measures attempt to make housing more affordable for residents of Vancouver and other BC areas. Public outrage has been mounting in Canada’s most expensive property market, amid fears the province is being used as a financial sanctuary for global capital.
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