“It’s unfair to the buyers and it’s also unfair to the sellers,” Urban Development Institute CEO Anne McMullin told Business in Vancouver
, as published by the South China Morning Post
“People sold and bought in good faith, knowing what the rules were. Now the government is coming in and completely changing the rules,” she added.
The executive warned that the uncertainty introduced by the new tax, which is scheduled to take effect on August 2, would make investors wary of funneling more of their money into Canadian markets.
“You could buy something and then, two years later, they’re going to completely change the rules with no warning, consultation or grandfathering. There could be economic fallout,” McMullin said.
Royal LePage West agent Adil Dinani agreed that the consequences have already started manifesting.
“I’ve had calls in the last 24 hours from agents representing foreign buyers who are backing out of deals because of this new tax,” Dinani said on Tuesday (July 26), the day after the tax was announced by the B.C. government.
“The provincial government really should have looked downstream to see all the different groups that would be impacted by this retroactive tax. I’m just not sure this was thoroughly thought out,” he stated.
Finance Minister Mike de Jong remained adamant in his Tuesday statement, saying there would be no special treatment or consideration for transactions signed before August 2 (with title transfers scheduled for the next day).
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In the wake of the B.C. government’s announcement of a new 15 per cent tax on foreign buyers of Canadian homes, real estate professionals have voiced vehement opposition, mirroring in many ways Chinese would-be buyers’ fears over the levy.