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Investors react to ‘flipping’ tax proposal

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Canadian Realestate Magazine | 26 May 2015, 11:15 AM Agree 0
One expert’s suggestion to tax those who speculate in real estate may do little if anything to nip flipping in the bud.
  • MFenn | 26 May 2015, 12:56 PM Agree 0
    'Put up taxes and you'll feel good' is not a sound economic or investment solution.
  • Peter | 26 May 2015, 01:44 PM Agree 0
    To be fair, there should be a flipping loss claim allowed by CRA.
  • David | 26 May 2015, 03:59 PM Agree 0
    There already are plenty of tax implications.

    If you flip a new property you have to repay the HST rebate. If you don't, and you get caught, you have to pay it back plus a penalty. Problem is that builders were turning a blind eye to this practice, but now (apparently) the government has many new tax inspectors to police the cheaters.

    Also, if you do this as a business you could have the profit taxed as income rather than capital gains (double the taxable income) if the CRA sees this as a business rather than a hobby!

  • Hans | 27 May 2015, 07:39 AM Agree 0
    Flipping properties does not need any flipping taxes added as it already creates a huge revenue stream for the government .First there is land transferr tax then then there are usually realty fees and they pay income tax on the commissions , then there are legal fees which also generate HST for the government then there other closing costs for the purchaser like inspections Etc. This revenue stream is all based on resale and then the profit if it exists will be taxed as income at the flippers income rate. so why would you want to stop or slow down flipping of properties when prices will self regulate deepening on the perceived benefits of the buyers?
  • | 29 May 2015, 02:45 PM Agree 0
    Flippers already pay capital gains. Taxing them more is ridiculous. There are those people who want a move-in ready home and the flipper is the person taking a gamble in doing so to give the buyer what they are looking for. The buyer is willing to pay a premium for that convenience.
  • Maxy | 29 May 2015, 03:42 PM Agree 0
    It is interesting how some of us flip a coin and convince ourselves that ONLY one particular side of the coin will turn up. While I am not a "flipper", do advocates of tax on flippers fail to realize that a flipper is taking a business risk? If flippers should bear additional tax burden because of presumed quick profit, what happens when they lose money? Will they be allowed to que for subsidy from the government? We preach free market when it favours our business model and preach government control when we perceive a potential, not real, crack on our profit margin. Any one who thinks flipping is such a lucrative business model should join them. Some people claim that they are in business to help others. If they are really out to help, they should assign a large portion of their holdings to their staff, a significant portion to the unemployed of our society and retain enough to keep the business going. Realtors must stop this game of "dog bites dog". We all believe in the rule of law. If flipping is not illegal and it is not unethical, why complain about flipping? Car dealers flip, furniture and appliance dealers flip. metal recylers flip. It is all a matter of kind not degree.
  • guy without property | 01 Jun 2015, 08:55 PM Agree 0
    Please go check the situation in Hong Kong. Hong Kong Govt imposed double stamp duty (ie property transfer tax here in Canada), it is originally like 3.75% and now 7.5% for those who hold more than 1 property.

    The result is the price further goes up since no one want to sells since they have to pay double if they buy back. It further tightens the supply of property.

    All sort of tax, fee, charges and etc imposed will be finally paid by the end users. It would not hurt the investors or flippers.

    People now can't afford to buy a property are those hurt most when property market crashed. They will probably lose their job at that time.

    I do not have any property and I do want the price to go down, but please be realistic.

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