Carlito Pablo, Georgia Straight
February 28th, 2018
Many renters and owners of B.C. apartment buildings may not have known that they were about to get hit in the pocket.
But thanks to the advocacy of a team led by father and son realtors David and Mark Goodman, the province government has changed course.
The extra cost would have come from the higher school tax announced by the B.C. NDP government in the provincial budget unveiled last February 20.
The budget provided a province-wide increase in the school tax for properties in the residential class, whose values exceed $3 million.
The residential class includes apartment buildings.
According to Goodman, his father David, also a principal with the Vancouver real-estate company, had received a call from Minister of Municipal Affairs and Housing Selina Robinson.
Goodman related that Robinson informed his father by phone Tuesday (February 27) that apartment buildings will no longer be covered by a higher school tax.
The school tax increases at the rate of the previous year’s inflation.
In the budget rolled out by the B.C. NDP government, an additional tax of 0.2 percent will be applied starting in 2019 on the portion of residential properties exceeding $3 million.
Based on the budget, a higher rate of 0.4 percent will be collected on the portion of residential value above $4 million.
The Goodmans, along with Cynthia Jagger, publish the Goodman Report, which provides information and analyses on real estate.
A news release by the Goodmans and Jagger noted that a landlord in Vancouver with a building of 27 suites and valued at $12 million will pay an additional amount of about $40,000 per year.
According to the team, that translates to around $123 per suite per month.
“Where do you think this payment will come from? “ the team asked in the news release. “While it’s the owners of course who must absorb this increased tax burden, needless to say they will seek ways to pass on the additional $123 per suite per month to their tenants. This will certainly not be good for our rental community! This school tax will have the effect of further exacerbating an already charged and challenged rental landscape.”
Following Robinson’s call to David Goodman, the team issued a second news release about the change.
“Robinson has now clarified after intense pressure and following discussions this afternoon with the Honorable Carole James, Minister of Finance, that this tax will now NOT apply to apartment buildings!” the second news release stated.