Last Updated on August 27, 2016
British Columbia is set to introduce an additional property tax of 15 per cent for foreign nationals who wish to buy residential property in Vancouver.
The city is in the grip of a real estate boom threatening to make owning a home a pipedream for the middle class.
Foreign buyers are partly blamed for the situation with statistic showing they spent more than $1 billion on property in the province between June 10 and July 14, the vast majority in Vancouver.
The new tax would aim to raise money to build new housing and boost the rental market.
Currently all buyers pay 1 per cent for the first $200,000, 2 per cent up to $2 million and 3 per cent thereafter.
The average price of a detached home in Vancouver was $1.5 million in May compared with $1.1 million the year before. Average prices were under $1 million in 2014.
The controversial program awards permanent residency to high net worth individuals in return for an investment of $800,000.
It was recently call one of the world’s most generous investment programs by an immigration expert.
QIIP saw a record 5,000 investors awarded permanent residence approval in 2015, surpassing the previous high of 4,436 in 2012. In 2014, 3,669 immigrants were accepted. Projections suggest 2016 will also see more than 5,000 candidates awarded permanent residency, with 89 per cent of those coming from Asia.
- Legally acquired personal net worth of at least $1.6 million;
- Owned and operated a business or held a high level management position in a private company, government or NGO for two of the previous five years;
- Invest $800,000 in a passive government guaranteed investment for a period of five years and receive no interest. Applicants may finance their investment and liquidate only $180,000 to $220,000 into a government approved financing program for five years and receive no return of capital.
Despite candidates being required to state their intention to live in Quebec when awarded their residency, the vast majority of them move to Vancouver and Toronto.
The federal government have admitted there is very little it can do to stop this, despite the investment dollars still going to the French-speaking province.
Under the Canadian constitution, permanent residency entitles the holder to settle anywhere in the country.
Quebec has the right to set its own immigration policies through the 1991 Canada-Quebec Accord.
Provincial premiers and territorial leaders recently called for similar agreements to be struck with each of them.
A federal program similar to QIIP was abolished by the previous Conservative government in 2014. If the Liberals moved to modify an updated version of this program, the problem of where the applicants settle and who gets the financial benefit would be resolved.
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