Orders of the Day

Hon. M. Farnworth: I call second reading debate of Bill 45.

Second Reading of Bills

BILL 45 — BUDGET MEASURES
IMPLEMENTATION (SPECULATION
AND VACANCY TAX) ACT, 2018

Hon. C. James: I move that Bill 45 be read a second time now.

This bill enacts the Budget Measures Implementation (Speculation and Vacancy Tax) Act, 2018.

I’m so pleased to have the opportunity to stand in this chamber and talk about Bill 45. As members in this House know, there’s been much discussion about this bill, and I’m certain there will be much more discussion to come over the next number of weeks as we debate this legislation. People will recognize, as I go through my notes, that I will speak about the bill as presented, and I will speak at the very end about some discussions that took place today so that members are up to date on that as well.

I’m so proud to speak to Bill 45 because it truly takes critical steps in tackling one of the biggest challenges faced by people in British Columbia. There isn’t a day that goes by that we — I’m sure all members of this House — don’t hear from constituents or hear from the public about people who are struggling to be able to buy a home, rent a home, find a home.

We’ve seen the crisis grow and grow over the last number of years. It began in the Lower Mainland but has expanded across to urban settings and across to other parts of British Columbia. We saw, under the former government, outside money flow into cities and suburbs, and houses really became commodities — commodities to invest in, instead of homes for people to live in.

Housing prices became completely disconnected from anyone’s local income, and rental crises spiked while vacancy rates dropped to near zero. We have a crisis, and “crisis” is not too strong a word to describe the situation we face when it comes to housing in British Columbia.

[L. Reid in the chair.]

Working and middle-class British Columbians can’t even imagine, can’t even dream, of affording a home. Families are working harder. I’ve talked to people who talk about good salaries, two working parents in the family, and are still not able to find a home or an affordable place to be able to rent.

[1:35 p.m.]

We have workers who are leaving our urban areas — and our province, in fact — looking for places where they can afford a home. Businesses can’t find the workers that they need to keep the economy going. I’m sure others, again, have heard the same stories that I’ve heard in our urban settings where you have businesses. I talked to a restaurant the other day that’s looking at closing down on Mondays and Tuesdays now because of staff, because they can’t find staff to work in their restaurant. What does the staff tell them? They can’t find an affordable place to live. They’re not able to live in the community that they need to work in.

That has a huge impact on not only the individuals in the community but, in fact, on the businesses and, therefore, on our economy. If employers are recruiting people to work in their businesses…. Again, I’ve heard this story often. They find someone who is a perfect fit for a unique position in their company. Then the person says that they’re keen to come, and they take a look at the real estate page. When they take a look at the real estate page for one of those urban settings, they decide that they can go somewhere else, make a fair wage and not pay as much when it comes to housing. So I think, when you take a look at the impact of affordable housing, the impact of affordable housing is there, certainly for businesses and certainly for our economy.

I also just want to mention the story that was in the Globe and Mail earlier this week that talked about Jesse Kirkpatrick and Jackie Myerion. This couple was living in a two-bedroom basement suite in Surrey with their young children when they were given a month’s notice that they had to move, vacate the property, so that the landlord’s family could use the property, which the landlord is able to do. The landlord was doing the right thing in giving them notice. But Mr. Kirkpatrick said: “We were looking daily for houses to have a place to live. I stopped working just so I could spend time trying to do that, but we couldn’t find anything at all.”

This family ended up living with their children in a tent in an East Vancouver park. This was a story from last week. They told the kids they were camping, to try and convince the kids that it was nothing to worry about, so the kids didn’t panic about living outside and being in a situation like that. That’s why, again, I have to say that a crisis is not too strong a word to describe the situation we’re faced with in British Columbia.

Two weeks ago I was at an event in Vancouver, hosted by the Metro Vancouver Alliance. It’s a group of organizations — social groups, labour, faith groups — that come together to talk about issues that they believe are important for their communities. One of the issues they raised, of course, was housing and the crisis that we face in housing. One of the young women at the event stood up and talked about what it was like to have to move three times in a time period of nine months and what that did to her life, to have to upend herself, to have to find another place, the stress of going through and finding another place.

She also talked about the fact that she stayed in a dangerous situation with a roommate who, from her perspective, was a challenge and created a dangerous situation. She didn’t have a choice but to stay in that situation because she couldn’t find a place to rent. This was someone who was working, who had the salary and couldn’t find a place that she could afford.

I met two young women who are going to nursing school here in my community. They’re living in a third-story suite in a house that’s been renovated. The two nurses told me and showed me, in fact, and it was obvious going up to say hello to them, that you went up a staircase to the third floor that had no railings, missing parts of the staircase — obviously a dangerous situation. We got to the apartment. They talked about the challenges that they had in the apartment, the things that needed fixing — plumbing, electrical.

They told me that they didn’t raise the issues with their landlord because they were absolutely terrified that they were actually going to be evicted and, therefore, wouldn’t be able to find a place to live. Those are two people who are training to be nurses at a time when we know we need employees in our province, and housing is the biggest impact.

There is no question, in bringing forward this legislation, that there is a crisis that needs to be addressed. There were opportunities for the former government to act. There were opportunities to be able to move on many of these pieces, but that didn’t happen. They let a speculative real estate market drive up the prices, heat up the market and cause the kind of crisis we see now.

[1:40 p.m.]

That approach is over. As a government, we have a responsibility to act. A government is supposed to act on behalf of the people of British Columbia. The people of British Columbia said housing is the critical issue that needs to be addressed, and we are going to act as a government.

We believe that the people who live and work in B.C. should be able to find and afford a place to live. It’s a basic, basic agreement with the people of British Columbia. That’s why we’re making the single-largest investment in affordable housing in B.C.’s history: $7 billion over ten years. It’s why we increased and expanded the foreign buyers tax, and it’s why we’re moving forward with the speculation and vacancy tax.

We’re seeing some early, positive signs that the market is starting to moderate, but this crisis isn’t going to be fixed overnight. It’s early signs, and it’s not going to be fixed if we don’t continue on with our 30-point plan to address the housing crisis.

The speculation and vacancy tax is a key piece of the work we’re doing to make sure that homes are there for people, not simply for parking money. It imposes a 2 percent tax on the properties of foreign owners and satellite families to tackle speculation and offshore money. It also creates a strong incentive for out-of-province speculators and people who are sitting on empty vacant homes to put those homes on the rental market or to sell them to add to the stock.

The tax also provides, through the revenue that comes in, a fund to be able to build affordable housing initiatives in the areas that are impacted by the housing crisis. Because when it comes to choosing between supporting British Columbians struggling to afford a home and real estate speculators, our government is going to choose British Columbians each and every time.

Our government is standing up for the vast majority of British Columbians who have been calling for action because they know the status quo isn’t working.

I’d now like to take a moment to just walk through the details of Bill 45 and the speculation tax. The bill contains 12 parts. Parts 1 to 4 set out the main components of the tax, including the geographic area, tax rates, exemptions and tax credits.

Part 1 of the bill sets out definitions and special rules for the tax and specifies that the tax takes effect in 2018. It also sets out that the tax will apply in B.C.’s core urban centres that are currently experiencing near zero vacancy rates. This includes municipalities in the capital regional district and most of Metro Vancouver. The tax also applies to Abbotsford, Chilliwack, Mission, Kelowna, West Kelowna, Nanaimo and Lantzville.

These sections also create look-through rules, which ensure that the tax treatment of corporations, trusts and partnerships generally depend on the individual who controls or benefits from the property that these entities own.

Part 2 of the bill applies the speculation and vacancy tax to owners of residential property in the specified areas that I listed. In the bill that’s tabled, the tax is calculated as an owner’s share of the property multiplied by the assessed value and by a tax rate of 0.5 percent, 1 percent or 2 percent, depending on the owner. For example, a foreign owner who is subject to the 2 percent tax rate and owns 50 percent of a $1 million property will be subject to an annual tax of $10,000 from 2018 on.

Madame Speaker, this bill is designed to ensure that the vast majority of British Columbians do not pay the tax. In fact, the estimation is that more than 99 percent of British Columbians will be exempt.

Part 3 details exemptions related to principal residence. It also exempts owners who rent out their home for at least six months per year, in increments of one month or longer. In 2018 the six-month requirement is reduced to three months.

The tax also exempts owners when they experience hardships. For example, people who are hospitalized, people going through a divorce, people whose homes have been damaged by fire or flood. They don’t pay the tax.

Our government is committed to increasing the available housing for British Columbians. That’s why there are also comprehensive exemptions for property development and those who develop or renovate residential properties. This approach will ensure that most B.C. residents who live in their homes and owners who rent out their homes long term will not have to pay the speculation and vacancy tax. Only foreign owners, satellite families and owners who keep their homes vacant in urban areas will pay this tax.

[1:45 p.m.]

Part 4 of the bill provides tax credits to help offset the speculation tax for certain owners. B.C. residents who are Canadian citizens or permanent residents and are not satellite families can receive a tax credit of up to $2,000, which effectively exempts B.C. residents on the value of a single vacant property up to $400,000.

Part 4 also provides tax credits to foreign owners, satellite families and other Canadians based on their household B.C. income. The credit ensures that taxpayers who contribute their fair share through our income tax system will not have to pay the speculation and vacancy tax on their principal residence.

The remaining parts of the bill, parts 5 through 12, deal with administration and enforcement. Homeowners will file an annual tax declaration which will help tax administrators demonstrate whether owners need to pay the tax. The declaration will be done by March 31 each year, after which taxpayers will receive a notice of assessment if they owe taxes. The taxes are due on July 2 of each year.

The administrative provisions give powers to administrators to conduct audits to ensure the tax is being complied with. The administration and enforcement scheme will ensure that the tax is easy to comply with for B.C. residents who own their own home, and it also provides tax administrators with the tools they need to ensure the tax can be collected from foreign owners, satellite families and people who leave their houses vacant.

The bill also contains provisions for people who choose to willfully or recklessly disregard the act. These provisions are very similar to offence provisions in other tax statutes, such as the property transfer tax.

Now, as I mentioned at the beginning, Bill 45 is a critical step for the people of British Columbia and for the future of our province. As some people may have heard today, we’ve been talking to our Third Party partners about our shared commitment to tackling the housing crisis. While we certainly do not always agree on specific policy proposals, we do agree, as partners, that urgent action is needed to make housing more affordable.

As was announced earlier today, the government has reached an agreement with our partners in the Third Party to support the speculation and vacancy tax legislation. The Third Party will be tabling three amendments which will be supported by the government.

The first amendment will speak to formalizing a meeting with B.C. mayors in the affected areas annually to review the tax and listen to feedback from the local communities. The Third Party, as you know, wanted to allow municipalities to opt out, but that certainly wasn’t acceptable when you’re looking at dealing with the crisis in this province. Instead, we’ve actually come to a compromise. This measure strengthens our ability to make sure the tax is focused on the communities that face the greatest affordability challenges.

The second amendment will introduce a legislative requirement that the funds raised for affordable housing will be used to build homes in the taxable areas. There already is a section in the bill that speaks to the resources and the revenue going into the housing affordability fund. This will make sure that the people of these areas will be able to see the benefits of the tax in their own communities when they see new, affordable housing projects coming on line. And as these communities are the communities that are the least affordable and have the lowest vacancy rates, to be able to build new housing projects in those communities just makes good sense.

The third amendment that will be tabled means that the tax rate for Canadian non-residents of British Columbia who are not part of a satellite family will be set to 0.5 percent. While we certainly strongly support the intent of the first two amendments, government believes — and we have been very clear about this — that this third amendment actually lessens the protections against out-of-province speculation investment. However, this is a change that was important to the Third Party, and we’re committed, as people will know, to working collaboratively with them to ensure that this vital piece of legislation comes into force.

Why do we care about that? We care because housing affordability — I’ll say it again — is at a crisis point. People in this province are calling for solutions. They want to ensure that they can afford a home in the communities where they live and work. I’ll say it again, that as a government and, in fact, as a Legislature, we have a responsibility to act on the critical piece that British Columbians are struggling with.

[1:50 p.m.]

That’s our job. Our job is to serve the people of British Columbia, and the people of British Columbia have spoken very clearly to say housing is a crisis. They want their government to act, and we are going to act.

This is a common value. We ran on a platform of addressing affordable housing and the speculation tax. We came into government making a commitment to a speculation tax and addressing affordable housing. We have an agreement, the confidence and supply agreement, with the Third Party that speaks to addressing affordable housing. So this is a shared value that I’m very proud, in the second reading of this bill, to say is going to be put into action. And we will act decisively to tackle the housing crisis. We will continue to work on our 30-point plan, and we will continue to bring balance back to the housing market.

S. Bond: I’m delighted to be able to rise in the Legislature today. I have to admit that we would have been delighted to rise in the Legislature today and debate Bill 40, which is actually one that has a very significant impact on British Columbians. It’s actually related to proportional representation, but it became apparent very late yesterday afternoon that the government had other intentions in mind. Now the mystery becomes clearer as we stand in the Legislature today.

We shift the agenda. We’re going to talk about the speculation tax. I want to begin by recognizing that I have a healthy respect for the Minister of Finance. We’ve spent a long time together, though on opposite sides of this House in this place.

But I want to lay out our view of the speculation tax. I have to say, we’re going to take a very different perspective than the Minister of Finance has taken.

I don’t for a moment doubt her sincerity…

Interjections.

Deputy Speaker: Members.

S. Bond: …in talking about people in British Columbia who are struggling to find a place to live that’s affordable.

I will, however, correct the record. When the minister stands and suggests that the previous government didn’t actually respond to the housing situation, nothing could be further from the truth. We had a significant investment, one of the most advanced plans led by members on this side of the House. So to stand in the House and say that, I’m not sure how she can do that with a straight face.

The most disappointing part of what happened today…. The minister talked about wanting to make changes that were important to the Third Party. For months in British Columbia, whether through texts, phone calls, petitions, through resolutions at the Union of B.C. Municipalities, through elected officials day after day after day asking this minister to consider making changes to a tax policy that has already had an impact in British Columbia…. The minister didn’t mention that part.

Well, interestingly enough…. The members can thump the desks.

Interjection.

S. Bond: He might want to go home and talk about housing starts in his part of British Columbia and the amount of investment that has been driven out of this province based on the speculation that this minister created.

You know, the minister sits and smiles. Let’s talk about this tax policy of this minister.

Interjections.

Deputy Speaker: Members.

S. Bond: From the moment she introduced the speculation tax, the first thing we saw was change after change after change. Somebody was captured, and then they weren’t.

And then the maps were drawn. Not one simple formula that could explain to British Columbians how their communities are in or out. Now they’re out again.

[1:55 p.m.]

Yet miraculously overnight — apparently just in the last few hours…. I would certainly hope that’s the case because this minister offered us a briefing yesterday and not one word about potential changes — not one answer to our concerns about the very things that she stood in the rose garden today and announced with the Leader of the Third Party.

Let’s talk about the Leader of the Third Party. The minister started to talk about credibility. This is a government that is sitting on the government benches because there are three members sitting on the end of those benches. There’s an agreement between the members of the Green Party and the members of the government, and we know that today is all about making sure that they hold on to the three members on the end of the bench.

This minister was more interested and more concerned about “changes that are important to the Third Party” than changes that have been asked for, demanded and called for by hard-working British Columbians and by elected leaders across this province. Their views didn’t matter. In fact, that minister walked out of the Union of B.C. Municipalities meeting and said, “Nope, no changes for you.” Yet after a few hours sitting in a room with the leader of the Green Party, miraculously, we have an announcement in the rose garden.

Let’s be clear. What the leader of the Green Party did was let down all of the people who were counting on him when he stood up and said, “I’m opposed to this tax,” and then it was: “Well, maybe I’m not really opposed to it. I just want a few changes.” What he got today is an embarrassment.

The minister can stand on that side of the Legislature and tout the great collaboration that took place. The minister knows full well that the leader of the Green Party and she have a secretariat. It’s called the $1 million secretariat because we, the taxpayers of British Columbia, are paying $1 million so that with this agreement between the two parties they can have briefings and updates and discuss issues.

Yet an issue that the leader of the Green Party has been standing up day after day after day and reassuring British Columbians, “I’m going to go to the House and fight for you….” Instead, all he got were some minor concessions that do not address the concerns of mayors that he sold out to make sure that he gets to keep his seat on that side of the House, despite having a $1 million secretariat to actually deal with these issues over the last number of months.

Let’s actually talk about what the minister stood in the rose garden and announced today. Remember, this is after we’ve seen boundary changes. We’re not sure how or why, and I’ll get to that a little bit later, but for a while, there were municipalities that were in — and then, amazingly, they were out.

Let’s look specifically, and we will, at which ones were taken out. This minister stands up and says she’s proud of this tax. I have never….

Interjections.

S. Bond: Well, keep on thumping, because there are a lot of British Columbians who are out there today who have no idea that in the minister’s definition they were the speculators she was targeting.

Let’s talk about the basic flaw. And we recognize that, I assume now, we’re going to see…. I don’t know. Perhaps the minister is going to table a new bill that reflects these. Or, better yet, I’m assuming that probably the leader of the Green Party will come in and then ceremonially make his amendments. But let’s be clear. The changes that were announced today do not address the concerns of elected officials, of hard-working British Columbians, who woke up one morning and found out that this minister and this government considered them speculators.

[2:00 p.m.]

We have been clear from the beginning of this minister’s introduction of this so-called speculation tax that she has chosen to tax the wrong people. She is taxing British Columbians. And while we see some minor adjustments today, I can only imagine how the mayors are feeling right about now, after all the work they did and after all the promises made by the leader of the Green Party.

Let me quote from the press release. “The first amendment will create an annual meeting between the Minister of Finance and the mayors in the affected areas to review the tax and relevant performance measures.”

We all know that that’s simply not good enough for those mayors, for those communities. They wanted an opt-out clause. That’s what the leader of the Green Party said he was going to fight for.

In the press release today, what did they get? An annual meeting. I’m sure they will be excited to learn that they’re going to have another chance to go and make their case to this Minister of Finance, where she can simply look at them once again and say: “Nope, sorry. You’re in.”

The second amendment, actually, is a very interesting one. Now we’re going to see the money that British Columbians are going to be taxed for…. Because it is British Columbians. We know that the majority of people paying the speculation tax are actually British Columbians. We now find out that because of the discussion and the changes wanted by the leader of the Green Party, those dollars are going to go back to those communities.

You know, I hope the leader of the Green Party, before he signed off on the press release, got the numbers from the Minister of Finance. If I were in his position, I’d want to be sure that any of that revenue…. Yes, it will be targeted, according to the press release, and we’ll wait and see. But I’d want to be sure that somehow it is going to be incremental investment in those communities.

Let’s face it, the minister stood up and touted her numbers. Let’s just watch and see. Are we going to see that money swapped out for the other money that has been planned for investment? There are no details, no rules — nothing. Just: “Trust me, we’re going to change it up.”

Let’s look at the third piece. I must admit, we’re glad to see that the tax rate for Canadians and permanent residents who reside outside of British Columbia and who are not satellite families…. They’re going to get their tax reduced to 0.5 percent. Isn’t that wonderful?

The people who didn’t actually…. Isn’t it ironic that there is not one reference in this press release to the fact that the target audience for this speculation tax is actually British Columbians? People who have worked and invested…. You can imagine some of the letters and stories that we’ve been hearing from people who had no idea that the family cabin that they inherited suddenly makes them a speculator. Let’s call it what it is.

Interjection.

Deputy Speaker: Member.

S. Bond: This leader of the Green Party stood up and told a bunch of British Columbians, a bunch of leaders across the province, that he was going to Victoria and fight for them. Well, today we see the results of that.

Basically, he managed to get a meeting for mayors. Mayors are way past the point of wanting a meeting. They are upset that without any legitimate consultation, their communities are being impacted. Make no mistake about it, Minister. I’ll start reading the list of investors that have already decided to put their projects on hold and leave the province. The damage has already been done.

Today we see little tweaks. “Okay. We’re going to fix it now, because ‘the minister wants changes that are important to the Third Party.’” Well, it’s about time that the minister started thinking about changes that are important to British Columbians.

On this side of the House, along with many British Columbians, we’re actually still left wondering how the government came up with the name for this bill. Everyone in this House would agree that we need to deal with speculators. But I think most people would also expect that a tax called the speculation tax — in some way, some shape, some form — would actually address speculation.

[2:05 p.m.]

As the opposition has said from the moment the Finance Minister announced her speculation tax, we fundamentally disagree that this tax measure actually targets speculators. In fact, it is a tax on hard-working British Columbians.

To get a better understanding of the minister’s definition of speculation, I did my homework. I reviewed what the Finance Minister said when she mentioned the speculation tax back in February of this year during the tabling of her first full budget. Let’s look at what the minister said then: “The tax will apply to property owners who don’t pay income tax here, including those who leave units vacant. This will penalize people parking their capital in our housing market simply to speculate, driving up prices and removing rental stock.”

Let me repeat the first sentence. “The tax will apply to property owners who don’t pay income tax here….” Well, I would respectfully suggest that what should have been announced in the rose garden today was a complete reversal of a half-baked tax policy. In fact, the biggest target is hard-working British Columbians — hardly considered speculators by this side of the House.

To the average British Columbian, this definition sounds as though the government, with the speculation tax, is going to focus on foreign speculators, non-residents. I can assure you that when the other side of the House did their testing of the name “speculation tax,” of course British Columbians would look at that title and think, “A speculation tax — that’s a great idea. Let’s go for it,” until they read the fine print. They were the speculators that this very minister was going to target.

She said it wouldn’t be people who actually earned a living in British Columbia. I’m not sure what happened between that and the bill that was tabled, but it is all about British Columbians. And not only that. When I was doing my home work, I looked, and guess who backed up the Finance Minister. The Premier. He said and reassured everyone that this tax would target property investors from out of the province. So now we have the Finance Minister and the Premier agreeing that this won’t touch British Columbians, that this is for people who live outside of the province and outside of our country.

Well, guess what. Here are the Premier’s precise words. Listen carefully. And I actually agree with them. Listen to this. “If you pay tax in British Columbia, you are not speculating from outside of B.C. If you have a home in Vancouver and a home in Penticton that you visit in the summer or to ski in the winter, that would not fall in with the out-of-province speculation tax.”

So we have the Finance Minister and the Premier assuring British Columbians that if they had a cabin in Penticton and a home in Vancouver, they would not be captured. Today the bill that’s been tabled is all about those very people that this minister and that Premier promised would not be captured. The key words are “out of province.” British Columbians took the Premier and Finance Minister, took her words, at face value. But we soon discovered that wasn’t the case.

It took us — and I always have a great deal of respect for my colleague, my co-critic — a lot of work in estimates. But after an extended discussion in estimates and asking a whole lot of questions, we discovered the details. Almost two-thirds of those expected to pay the new speculation tax, we discovered, were British Columbians, the very people the Premier and the minister promised would not be captured.

[2:10 p.m.]

Despite explicit comments from the Finance Minister and from the Premier, approximately 20,000 of the 32,000 homes that will be impacted are owned by British Columbians, not people who don’t live and work in our province but hard-working, tax-paying British Columbians.

You can imagine how shocked we were, not to mention the thousands of British Columbians who suddenly found themselves being called speculators and facing significant tax bills. They said it wouldn’t include people who lived and worked in British Columbia, and now we see in Bill 45, in black and white — at least this version of it — that that isn’t true.

We’ve heard from many of those British Columbians, and I want to be sure that this minister hears over and over again how upset people are. The minister said one thing; the Premier said one thing, and they did something completely differently. In fact, the only place this bill even remotely relates to speculation, to legitimate speculators, is in the title, and even that has changed.

We’ve seen policy on the fly, people asking for changes, changes being made that are inexplicable, a lack of modelling. No one can actually explain how on earth the communities that are on the list got on the list and how the communities that aren’t on the list are not on the list — some that are not on the list anymore. But I’ll speak to that.

We now actually see a bill that includes the word “vacancy.” That would lead us to believe we have a speculation and now a vacancy tax. I very much look forward to the minister’s explanation of how the name change evolved — probably more of those changes that are important to the Third Party.

What’s even more puzzling is the fact that it appears the tax regime might actually exempt speculation in some circumstances. I can hardly wait to have this discussion in committee.

Again, we’ve had the benefit of a half-hour briefing that we certainly appreciated. The minister is always ready to do that, and it is always appreciated, but I look forward to more clarification and verification.

Since we’ve had our half-hour briefing, since the bill was introduced, the very large bill that it was — we’re good; we’re adept; we can go through those things — we’ve seen announcements today that change the intent of the bill, and we want to certainly clarify some of the numbers and things that we’ve seen once we have the chance to do that.

This tax potentially exempts speculators. It builds in a one-year exemption on newly purchased properties. Think about that for a moment. It’s possible that the bill actually permits someone to buy a property, wait for the price to rise and sell it within a year. Some people might call that flipping. Others might call it a wise investment. But almost everyone would agree, on the surface at least — and we look forward to further clarity — it appears to be speculation, pure and simple. So again, we’ll look forward to a fulsome explanation when we reach committee stage.

But I guess we shouldn’t be surprised. Having a speculation tax that doesn’t deal with speculators fits the pattern that has emerged with this minister and government. We have an education tax that has nothing to do with education. We have a health tax that was a complete surprise and transfers the cost of MSP premiums directly to employers in British Columbia, and we’re certainly going to have a lot of time to discuss that in the days ahead as we begin to deal with the EHT.

To the minister’s comments about impact: we can tell you that this has certainly already had an impact and that the damage has already been done. Families have seen home ownership dreams move further away as more than $1 billion in housing investments have been cancelled or postponed since this minister announced her speculation tax — projects sidelined, no homes built, wages lost.

This bill, and I agree with the minister, isn’t about numbers and formulas. It’s about people. The sad part is that it’s mostly about British Columbians.

Let’s look at some specifics. Here are the details that you were eager to hear. Macdonald Developments cancelled 600 new homes in Langford and 110 lots in Kelowna worth a total of $500 million since this minister introduced her speculation tax. Belmont Properties has put on hold 600 market and rental properties in Victoria since this minister introduced her speculation tax.

[2:15 p.m.]

Housing starts, the sign of a strong economy and new housing on the way, are dropping. The supply is going down. They’ve gone down 43 percent year over year.

The minister can laugh. She and her friends can snicker over there. But she can’t deny that there has been an impact in British Columbia before the bill is even passed. It’s probably a good thing, because now we have a different bill, or we have different amendments. We’re never sure what’s going to happen.

Housing starts in Vancouver are down 42 percent, and it’s not just that. When you look at the implications of the changes that have been made, every single day, we seem to see a change. We have to wonder. We have to ask a broader question. We have to start asking hard questions about the credibility of the budget in totality.

Based on our calculations — and we’ve only known this for the last couple of hours — the minister has dropped the tax revenues on this tax alone by 70 percent. Housing starts are 17 percent lower than what this government forecast, and based on their numbers, that’s about a $340 million hole.

I haven’t even begun to calculate the impact of the minister’s budgets on plummeting sales. But I can hardly wait. I know that my colleague and co-critic is working, as we speak, to look at those numbers, and we’re going to ask some pretty tough questions, not just about the speculation tax but about the credibility of this budget overall.

Municipal leaders whose communities are impacted by the tax are calling on this government to rethink their half-baked tax and look at the consequences. They asked the minister directly. In fact, they thought they had some cooperation with the leader of the Green Party, and we’re already hearing about how they feel about what happened today in the rose garden.

They’ve asked the minister to consult in a meaningful way. What did they get? The minister tabled Bill 45, determined to press on. After the rose garden announcement today, what did they get? The promise of an annual meeting.

Here’s just a sample of what the mayors were saying. Kelowna mayor Colin Basran: “It’s the uncertainty that’s raising a lot of concerns. It’s damaging our economy, because when people don’t know, they’ll just sit and wait, and that’s not a good thing.” Go ahead and laugh and pound the desks. That’s the mayor of the city of Kelowna. Here’s what else he said. “This proposed tax will not have the desired outcome and will have negative impacts on our communities.”

West Kelowna mayor Doug Findlater: “We’re fundamentally concerned this would push property values below the amount of equity people have in their homes. It’s a potential financial crisis.” Speaking of crisis, Mayor Findlater went on to say: “If they go through with the speculation tax, the only people who will be able to afford really expensive places are the really wealthy, who would buy them up at a fire sale price.”

Langford mayor Stew Young said: “This is a direct job killer.” Bill Veenhof of the Nanaimo regional district said the speculation tax “should be eliminated altogether.”

Right here in the capital regional district, they are opposed. Yet it took a meeting this morning, apparently, with the Leader of the Third Party so the Finance Minister could deal with changes that are important to the leader of the Green Party. What on earth does the Finance Minister have to say to those highly respected, locally elected officials, who have been asking her for months to listen, to consult and, most importantly, to back off the tax grab?

The quotes go on and on, but I want to be clear. The government has literally drawn circles on a map. They have fixed the boundaries. The Premier’s community of Juan de Fuca was exempted from the tax after much outcry. The Gulf Islands were exempted after protests from the Member for Saanich North and the Islands. The member from Oak Bay was worried about having to pay the speculation tax. Miraculously, his area was exempt as well. In and out.

I can assure you, while we certainly witnessed the event in the rose garden today, it simply doesn’t go far enough. We’re going to continue to ask tough questions. We’re going to continue to speak on behalf of those mayors and those communities who’ve been asking this minister to listen, to make a difference, to pay attention to their concerns.

[2:20 p.m.]

We’re also going to be asking some questions of the leader of the Green Party about what happened to all the promises he made to people to come to this House and fight on their behalf.

I can assure the minister that the tweaks made today are not good enough. It is absolutely our intention…. We will be making an amendment ourselves in the days ahead that will actually listen to the mayors, listen to the communities and show them that at least someone in this House is prepared to stand up and fight on their behalf.

N. Letnick: Quite a challenge to follow such a great speech that we heard from the member from Prince George, and every word that she said was true. Congratulations to the member from Prince George on delivering a great speech. I’m also going to be speaking — and no surprise to the members opposite — against the proposed tax, including the proposed amendments that I’ve heard, but I’ll deal with the tax itself.

Obviously, we’ve had many opportunities in this House and out in the community to talk about the title, the title being speculation tax. This is not a tax on speculators, especially after the last change. This is really a tax on vacant properties that British Columbians and Canadians have decided to invest in, whether they lived in Alberta or in other provinces — perhaps bought something in the areas that are being targeted by this tax and other areas that haven’t been yet targeted by this tax but may be at a corner in the future.

The government is seeing an opportunity to help build their war chest to fight on all the issues that they have in their budget. As they see declining revenues, this is just one piece of revenue that they can’t afford to lose. So they’re tweaking it. They’re trying to find a new way to make sure that we have the transfer of wealth from the rich to the poor. It’s just another opportunity for them to see if there are any dollars out there that they can grab and re-channel to a different location.

Obviously, it’s having an impact. It’s had an impact ever since the spec tax was proposed. We’ve had meetings in Kelowna, in the area of the Central Okanagan. I’m sure we’ve had meetings…. Other MLAs will talk about meetings in their particular constituencies. We had a meeting of about 40 people right off the bat, of all kinds of groups: non-profit groups, development groups. Government people were invited.

They were unified in their opposition to the spec tax, not because we’re opposed to taxing speculators and reducing the amount of speculation in the housing market. But we were opposed to this tax because it wasn’t a spec tax, unlike what is being proposed by the Leader of the Official Opposition as a true spec tax. It was a vacancy tax, and it still is a vacancy tax.

Here’s the challenge. In the short term, it actually might work in dropping the cost of housing. It will scare off people who currently have second homes, whether they’re British Columbians or from outside British Columbia, and say, “Well, I don’t want to rent my home. I never planned on buying this home for rental. I plan to buy it so I can move in during the summers and then maybe retire in it. I come from Vancouver. I want to go to the Okanagan,” or, “I want to go to Nanaimo during the summers,” or maybe: “I want to go skiing in the winters.”

Whatever it is, that’s their choice. They’ve worked hard for their money. Why should we, as government, be telling them where they can or cannot spend those hard-earned dollars? Quite a difference in philosophy between the free enterprise and the socialists across the aisle.

But you know what? At the end of the day, all these people came to the conclusion: “We have to work with government. We have to find a way to get them to see the light. We have to see if we can make the changes necessary so we can get a true spec tax.”

I quite honestly thought the project was doomed to failure. I can tell you now that I got up at that meeting at the end, and I said: “Yeah, we should do everything we can. But given the history of this government since they’ve been elected, I don’t think we’re going to be successful in getting them to make the changes we want them to so it becomes a true speculation tax.” I said: “Really, at the end of the day, the only way you going to be able to change the spec tax is to change the government.”

[2:25 p.m.]

I will send the message out again to all the people of Kelowna. You want to get rid of the spec tax? Get rid of the government. That’s really the only way you’re going to get rid of the spec tax.

The mayors have asked for the opportunity to opt out. The Leader of the Third Party has said he will go to bat for these people, all across the province. I’m not disappointed in the Leader of the Third Party. Quite frankly, I was not expecting anything more than what he’s done today. He’s been consistent throughout his year and a bit in his role, consistently going out there and bashing the government for this thing or that thing — doing a good job, I must admit, on some occasions, of really sticking it to the government. But at the end of the day, the tail goes between his legs, and he votes with the government anyway.

For all those people out there that really had some high hopes for the Green Party and the Leader of the Third Party for anything in the future, hopefully right now all those illusions are cast aside and they can see the true colours of the Leader of the Third Party.

What do we need to do here? Well, obviously we need to make sure that we look at both the income and the expense side of owning a home in British Columbia. What the government is doing with the spec tax is trying to reduce what the cost of housing is by taking that wealth away from people who have invested in these homes and saying: “Nope, we’re going to force you to sell your homes at bargain basement prices and see a reduction in the cost of homes.”

That’s specifically what the Finance Minister said she wanted to achieve — I’m not making it up; these are things that the Finance Minister said — and unfortunately, she’s been successful. We are seeing a drop in the cost of these homes because people are putting them on the market. The problem with that is that it’s a short-term solution. In the short term, that will reduce the cost of homes, for sure, but who in their right mind is now going to get out there and build supply? For whom?

Nobody is going to come forward from Alberta. A lot of people in our province come from outside of the province. People from Alberta aren’t going to come in and invest their money now in the Okanagan, in the Kootenays, in Nanaimo or in Parksville or other places. Why would they? Even if it’s not covered by the spec tax, the fear of this government’s legislation is pretty clear: “We will re-evaluate who is covered and who is not covered.”

Obviously they have done that already by exempting the Leader of the Third Party’s second home from this list. How did that happen? I’m sure we’re going to get into that question a little later. Who’s going to be buying these homes? Short term, for sure, but in the long term, why would suppliers be supplying?

We’ve already seen that across the province. On project after project after project, in different parts of our province, they have said: “I’m going to wait and see what happens with the spec tax. Maybe my business plan doesn’t work anymore — my business plan of having people buy some of the units at the higher-end prices to help subsidize what the lower-end prices cost.”

It’s quite simple economics. The opposition gets it, but the government doesn’t get it. In the long term, we’re actually going to be hurting the people we’re trying to help. We’re going to be hurting people’s opportunity to buy in the supply of housing. If you want to help people get into affordable housing, help them get into it. Don’t hurt the people that are building the housing in the first place.

You look at the member for Langley East. For many, many years, he led the former government’s policies on affordable housing and housing in general, and hardly got any questions from the opposition at the time, the now government. Why was that? It’s because he was doing a great job. He and the government of the day, for the last 16 years — I’m really proud of that track record — were building a lot of affordable housing.

They also had policies, before I got there and since I got there, on helping people get into the market — different policies, different ways of helping people get into their first homes, so that they could work in the market and get up to the larger homes that they required for their families. That’s the right approach. Help people get into their first houses. Help people with their economy, so that they can afford it. Make sure they have the right education. Make sure they get good-paying jobs. Make sure British Columbia’s economy is going strong, so that people can afford to buy the homes that they want to buy in British Columbia.

It’s not to tell people: “Well, you know what? If you have a home that’s empty for four months of the year, we’re going to force you to rent it.” Who in their right mind now, with the rules changing in ways favouring people in rentals, is going to want to get into the rental market for four months. They can’t ask the person who came in, in the first place: “Well, you know what? It’s time for you to leave now, because I want to take over the house.” That’s not going to work anymore.

Why would somebody want to take a chance in putting somebody in their home that, at the end of a few months, says: “You know what? I’m not leaving. Too bad for you”? If you want to go skiing, or if you’ll need that second home in the Okanagan that you were planning to retire into — sorry, you’re going to have to change your plans.

[2:30 p.m.]

Who’s going to be buying these units? Who’s going to be building these units?

Madame Speaker, I’m telling you right now, it’s already happened. We’ve already seen a drop in developers’ proposed units that are coming on stream. We’ve seen people back out of building units. I’m sure my colleagues from other parts of the province are going to be talking about some specifics. A true spec tax would not do that. A true spec tax would basically target those people who are speculating in the housing market. I think we have consensus on both sides of the House. We would like to see something focused on them.

I go back to the story that I heard quite some time ago regarding…. These guys were going to a restaurant, and the restaurant bills were getting a little higher. It was about five or six friends. One of the guys said: “Okay. I’ll tell you what. Rather than us not coming to the restaurant anymore, I’m going to pay a little more. I’m going to pay a little more because I can afford to pay a little more.” So they agreed; they would actually start paying based on how much they could afford.

[R. Chouhan in the chair.]

After a few months, the bills got higher and higher, and then the other five guys got together and said: “You know what? I don’t think Joe’s paying enough. We’re going to make Joe pay even more.” And you know what happened to Joe? Joe stopped going, and the other five guys were stuck paying way more than if they’d just kept Joe paying what he was paying.

That’s the fallacy of this whole spec tax — thinking that we’re going to get the Joes and the Janes of the world to pay more so they can lose equity on their homes, so somebody else can get it for a bargain basement price, and that will help people who’re trying to get into the market down the road. That’s just a fallacy of this whole system. The best way to make sure that we fix the problem is by getting rid of the spec tax altogether. But that’s not going to happen.

It’s not going to happen because the Green Party, I think, made it very clear in their platform that they have full intentions, if they ever had a chance, to tax the financial gains on personal private residences. It says in their platform that the policy is to make sure that if people have a personal financial gain — I think it was over $750,000 — we should tax that. Never in our province’s history, as far as I know, have we taxed personal financial capital assets like that on principal residences. To think that the Green Party, which is actually left of left, is going to come forward and say to the NDP, “Hey, you better stop taxing people with wealth, because that’s wrong policy,” is totally wrong. That would not have happened.

I was pretty clear that the members of the Green Party were out there shooting off their mouths saying how well they’re going to stop this tax, but at the end of the day, they would just basically cave, and that’s exactly what happened. But they didn’t cave until actually they got their house out of the spec tax areas, which is really curious. I think British Columbians should be up in arms over that itself.

Mr. Speaker, I’m going to stop now. I need to go. But I would just say to you and to all British Columbians that this spec tax is wrong. What the mayors have asked for I think is reasonable. They should be listened to, they should be respected, and they should be heard by the members of this House. Hopefully, as we go through committee stage, we’ll have members of this House support all the amendments. How’s that? Let’s agree to that. Let’s support all the amendments that are proposed, especially the ones that take this tax and throw it out the door.

N. Simons: It’s an honour, as always, to stand and speak on legislation that’s before the House. This particular piece of legislation is designed to address a crisis that has developed over the last number of years because of the inaction of the member who just spoke and his colleagues.

We are in a crisis. We are trying to emerge from a crisis. That’s a crisis that maybe you don’t see. Maybe the members of the opposition don’t see that crisis because they don’t want to admit to having been part of its creation over the last 16 years. And if that’s the reason for this vehement defense of their indefensible position, maybe I can understand it. But when have they offered an opportunity to find ways out of this crisis? When have they actually mentioned the interests of individual British Columbians? I’ve never heard them talk about that until today, until they had an issue with our efforts to address a problem that they created, in large part.

[2:35 p.m.]

I think this is one of many routes towards addressing the crisis. It’s the Speculation and Vacancy Tax Act, and yes, the name includes the Vacancy Tax Act.

So far, what I’ve heard opposition members critical of is the fact that they don’t like some aspects of this particular piece of legislation. I sat on that side for 12 years. I remember finding things to criticize. In fact, yes, we often did, because government gave us a big target. In this particular case, I think that their particular vehemence is due to the fact that they are a little bit defensive on the fact that this is an issue we’re trying to address that they failed to address.

Obviously, the goal is to have an impact on the housing market that results in better opportunities for British Columbians to be able to live in an affordable place, with the ability to live in a comfortable way. This is what we hope for all British Columbians. I believe that this particular aspect of a 30-point plan — I would remind people, a 30-point plan — is just one more element of our overall strategy. For one, I believe that this is going to go a long way towards addressing key issues that we’ve been raising over the last number of years.

I’m pleased to say, as well, that despite opposition’s temperature, this is a step that government’s taken that is largely supported by British Columbians. There seems to be a great deal of support. I’m just looking at polling. I’ll be glad to enlighten my friends opposite about the support that it seems to have among British Columbians.

Let’s see now. The Angus Reid Institute. They quote 88 percent support speculation tax; 81 percent of B.C. Liberal voters support the speculation tax in Metro Vancouver.

I’m not the pollster. I’m reading the polling results. So if there are some methodological issues that they want to raise with the polling companies, they can do that, but I don’t know why else they’d be questioning these polling results.

Angus Reid Institute, May: 45 percent say it’s a very good idea, and 30 percent say it’s a good idea. That showed 62 percent of B.C. Liberal voters supporting it.

Well, they may have knocked on the door recently or rung a doorbell or a gate bell and found out that person doesn’t particularly like the idea, but that’s understandable. Not everyone’s going to like every aspect of every piece of legislation that’s put in this House. They seem to have found something that they can complain about.

How about this one? A Mustel poll: 77 percent support measures to curb speculation, and there’s large, 63 percent, support in the business community.

I don’t want to put words in everybody’s mouth. People are going to have differences of opinion and, actually, different strengths of those opinions. There might be some people, who we’ve heard already, that hate every aspect of it, including the title. I’m not sure if they’ve engaged in any discussions around putting forward amendments, but that’s their responsibility. That’s their role. I expect if they want to see changes, they should put forward some amendments.

This is a government that recognizes that in order to govern for the people of the province, sometimes compromises have to be made. Sometimes re-evaluations have to be undertaken. When, in anybody’s life, is the idea that you can’t change your mind on something that really determines everything that you do? We need to think and need to reflect and need to review decisions we make. Sometimes those result in better actions and better ways forward.

The criticisms that I’ve heard mostly are around the fact that we’ve made some changes. But at the same time, members from opposition criticize those changes. They say, on the one hand, that we’re not listening, and on the other hand, that we’ve listened too much and we’ve made changes based on what we’ve heard.

I don’t get that. That’s what I had a problem with, with the original response to the Finance Minister’s introduction of this at second reading. You can’t really have it both ways. Either we listened and we responded, or what? We responded. We obviously were listening to the people in communities. We were listening to elected officials around the province.

[2:40 p.m.]

We were listening to the people who had their views made well known at the Union of B.C. Municipalities meeting. That is why our government decided to make some changes and to make it clearer, to show where the exemptions were.

The other criticism was that there was uncertainty in this legislation. Now you have it. You have a nice thick piece of legislation before you, and you can go through it. The uncertainty should be dissipating as we speak. It should be dissipating as you go through those number of pages where we have, in fact, outlined the details of this speculation tax.

The uncertainty is over. The legislation was originally announced to this place many months ago, and I’m pleased to say that now that we have this legislation before you and that it has the support of parties that were elected with 57 percent, I believe, of the population, that’s a good thing. It’s a good thing that we listened. We’ve listened to the people of this province, and we’ve listened to our colleagues who were elected in the ridings they represent — the Third Party, the Green Party, the party that sees some common ground with the elected government.

You know, that is ultimately a good thing when we can come together and can find compromises. I didn’t like, necessarily, the characterizations of the Leader of the Third Party. I don’t believe it’s fair. I think when you do compromise, you don’t always win everything you want, and you don’t always lose everything. So when you find compromise, it means give and take, ladies and gentlemen. It means some give and take.

We had 16 years here. I say that just because it’s a period of time that’s identified, 16 years, when you had 100 percent of the power on this side of the House and no interest whatsoever in what the opposition thought. I sat there for 12 years, and I know the frustration. I can read it in your faces. I recognize that. Here you see a government that actually knows how to talk to other people and knows how to find compromise. I sat over there when this side of the House had no interest in compromise whatsoever. Absolutely none. None. Zero. One hundred percent of the power and no interest in compromise, no interest in discussion, no interest in finding common ground.

Anything is better than that. Anything is better than that. What we have now is we have some compromise, we have some discussion, and we have some interesting debates. And you know what? We come up with legislation that’s nuanced. It’s not all or nothing, the way the previous government liked to do it. Winners and losers. Well, we know where the losers were. You know what? We’re trying to address the impact of a government that gave little consideration to those people that I’m interested and we are interested in supporting. That’s the people of British Columbia.

Now, I know that my colleagues across the way who find it necessary to speak, as I like to sometimes…. They will have an opportunity to speak, and I would love to hear their views on this. And I’m hoping that they might even have views that are somewhat different from their colleagues. But so far, all they’re doing is toeing a party line and saying exactly what their talking points tell them to.

In my view, we’re elected as individual MLAs, elected as private members, and we have a responsibility to reflect the interests of our communities. And my community recognizes that we have a crisis. We have had a crisis for a while now.

We have people not just living in tents where you can see them, where the people from the urban communities are all upset. They can see tents at the side of the highway. I understand that. It’s a shame in a province of this wealth that we see that. But we’ve had people living in the bush on the Sunshine Coast, out in the back. You don’t know where they are. They’ve got tarpaulins, they’ve got little heat, they’ve got little access to services, and they’ve been there for a while.

The member from Kelowna seems to be interested in those people who are living homeless in the shelters, in the woods, in their cars, in run-down trailers, in campgrounds — people who have been left out of the all-or-nothing government that existed before we took over. I’m pleased to be able to say, on behalf of those people, we’re doing something about it.

We’re addressing this crisis that they created. They might be kicking and screaming and whining and chirping, but we are addressing the issue. We’re addressing it in many different ways, and this is just one of those ways. And I’m proud to belong to a government caucus that is actually interested in addressing the inequalities that were created over these many years.

[2:45 p.m.]

I think that what we have before us is entirely supportable legislation, and I’m pleased that representatives of our party met with representatives of the Third Party.

They mock a system of finding resolution. They mock the idea that we have a structure in which disputes can be resolved. Now, that tells us more about their character than it does about finding good ways to find good policy for people of the province. I’m not going to take that personally. Obviously, we have a good system in place because we have the ability to influence policy and make good legislation for the people of the province. That’s by cooperating.

We have an opportunity to do that with members of the official opposition. They might think, because of previous history, that the opposition has absolutely no power. That’s just because of the way they ran things when they were in government. The opposition should stand up and put forward proposals.

So far, I think they want to change the name of the bill. They want to take out the word “speculation.” Well, put forward an amendment on the title. Why not put forward an amendment on the title and say: “We want to call it something else?” Fine. I’d be interested in hearing that debate. I would prefer to talk about substantive things, but so far, we haven’t heard any of that.

The news that we’ve come to an agreement and that we’ve seen a way through to ensure that this particular initiative on the part of government will be passed by this Legislature on behalf of the people of this province is, I think, good news. It’s not unexpected that the opposition would characterize it negatively. That is their role. Their job is to ask questions.

It shouldn’t be a threat — that they’re going to ask questions, that they’re going to ask tough questions of the minister in third reading. That is their responsibility. I expect them to do that. I would expect better questions in question period, too, but that’s just because I’ve had 12 years in opposition and a little bit more experience in that.

But the questions that you come here with are important because then it’s on the record.

Interjection.

N. Simons: I have no interest in going back, as much as it’s a very kind invitation. I must say I’m sure it was offered in graciousness, but no, the view from here is slightly better. The sun comes in at a different angle, and I have enjoyed it so far.

I think the opposition should see this as an example of how, when elected officials work together and they find some compromise and they find some way past difficult aspects of legislation, that’s a good thing. I think it’s entirely possible that in the future, we might not have the same ability to get to a resolution. But so far, with civility and with good communication, with a structure that allows for disputes to be resolved — those are all good elements of a good democracy, in my opinion. It’s not a winner-take-all system. It’s not, “We win; you lose,” or: “This is the way it goes, our way or the highway.” This is about compromise.

As you know, the legislation we’ve introduced is an effort to address the situation in the housing market and turn empty properties into homes. I do believe, as well, because of the overwhelming support in British Columbia, that there are many British Columbians who agree that we need to have access for rent and that we need to have access to affordable housing. People are sometimes, despite what they say, prepared to contribute to ensure that our society is one where people are looked after. If they knew individuals were suffering without….

If they had 80-year-old people coming to their offices and saying that they can’t find a place to live, maybe they’d be more likely to accept some suggestions of the government or even support some of the initiatives that the government is taking. Maybe if they had homeless people knocking on their doors, they would see this differently. For a long time, we’ve seen a province that has not addressed poverty reduction. They didn’t address child care issues. They didn’t address the homelessness crisis. We’re dealing with a lot of things in this province. And the fact that they didn’t, shouldn’t mean that it’s too late to do something.

We’re doing something now, and in my view, they should be supportive of it. However, I’m a realist as well. Sometimes opposition needs to be oppositional in order to feel important, and I have nothing against that. I remember that feeling. I remember asking questions in this House. I remember voting against legislation. Usually it was legislation that I definitely wanted to vote against.

[2:50 p.m.]

However, I would never have voted against legislation that was aimed at improving the lives of British Columbians. I never voted against legislation that was tabled in order to address a crisis in our society. I didn’t vote against legislation that was well-thought-out, widely supported and entirely with an objective to address a crisis.

Now, the other thing that I’ve heard from the opposition is that it seems with the changes that we made…. They don’t want to characterize it as us listening and making changes. They want to characterize it as us unable to land on the exact legislation immediately.

Well, these are the same people who criticize us for saying we need a plan to reduce poverty. “Why do you need a plan?” they say. “You don’t need a plan.” You just hope jobs keep coming. That’s their plan. That’s not a plan.

We have plans for all aspects of British Columbia. We have expectations, I should say, that our province will be a place where people can find a place to live, not in squalor and not in abject poverty, where they want to work and where they can find a place to work. Unfortunately, in my constituency, just to be specific, it’s very, very difficult to find a place to live. It’s a difficulty that has grown, and it’s grown over the last number of years.

What we’re trying to do now is address that by making it possible to promote the building of houses and homes where people can afford to live. I think that’s an admirable goal. It’s one that I support. It’s one that the Third Party supports. I’m sure that in the heart of hearts of members of the opposition, it’s one that they support too.

They may have differences of opinion with respect to specific aspects of the legislation, and I encourage, support and applaud any efforts they make to bring in amendments. If those amendments are brought in with the right spirit and with the hopes and expectations that they will improve this legislation, then that’s the job of the opposition members to do so.

In third reading, when we hear the pointed questions and the tough questions that are without malice and individual insult, I think we’re prepared to listen. We’ll answer the questions, and we hope and expect that those questions will be tough. That’s the role of opposition, and the role of government is to implement good policy that will address the issues that British Columbians want them to address. That’s what we’re doing with this legislation today.

With that, Mr. Speaker, I thank you very much for the opportunity.

B. Stewart: I rise today to speak on a very important piece of legislation, Bill 45, called the Speculation and Vacancy Tax — recently renamed. You know, on this side of the House, we’re left wondering just how the government or the people that do the marketing have come up with this name, because it doesn’t really seem to address the terminology of what speculation is all about, whether it’s the stock market or people buying commodities and whatever.

There are speculators in those types of things that invest in the future upside, and sometimes they get caught in the downside. Those are truly the speculators that we as government do want to make certain we try and control.

We’re sadly disappointed with this bill, because it actually fails to deal with the real terminology about speculation. This tax exempts speculators, and it bakes in even a one-year exemption on newly purchased properties. So buying a property, with this new piece of legislation should it go through, waiting for the prices to rise and selling within a year would be exempt, and you wouldn’t have to pay any speculation tax. We call that, or some people call that, flipping. Others call it a wise investment.

I want to go back. The members are talking about the cycle of what the economy is like.

[2:55 p.m.]

Over 45 years ago, there was a new Premier in town, and he went on to create all sorts of things that are still legacies we have today — government auto insurance, the agricultural land reserve and many other things. As we heard in his memorial and in remarks earlier this year, a remarkable number of pieces of legislation were passed during that period of time. That was leading into the ’70s when, I can remember, as a young employee working in the financial services and banking industry, inflation running at over 10 percent. Although we weren’t making very much money, the fact is that prices were rising at an astronomical rate. The bottom line is that we were just happy to find a place to rent and be able to afford it, share it with friends. I know that lots of that goes on today.

The point about it is that it’s funny how we can go from an economy that was growing at more than double-digit inflationary growth…. Interest rates were comfortably at 10 percent for first mortgages — there are a few that might remember that — and second mortgages were maybe around 12 or 13 percent.

We got to 1980-81, and all of a sudden we had things like the national energy program. We had nationalization, really, of the oil industry in Alberta. We had this complete slowdown in the economy, and there we were in British Columbia, fighting this expectation that wages should go up every year by 8 or 10 percent. You look back at the contracts that were done with government employees, etc., and it seems staggering today. Here they are negotiating at zero, 2 percent, and it all seems very much in balance. But sometimes these cycles take time to work out.

We got through the ’80s into that time when Expo 86 was here. We were pretty proud as British Columbians: come to us, come and invest here and do these things. In those days, we didn’t even yet have a foreign trade office. It was actually opened in that period of time in Japan, in Tokyo, by former Premier Bennett.

Anyway, I think about the fact that we keep talking about what’s happened in the period of time that our government was in power. Well, think about when your government was in power 27 years ago. What happened? You had ten years of running the economy and stuff like that. We had similar issues. We had crises in terms of housing, the fact that your average expenditures, on an annualized basis, were running at more than $4 billion on operating costs before paying for any capital improvements and stuff like that.

Governments have to adjust to what cyclical kinds of challenges are out there. I think that reality…. The speaker previous mentioned the member for Langley East. I can remember when he told us about the B.C. Housing projects, and I thought: “Jeez, do we need to be spending this type of money?” He’d stand up at cabinet, and he’d be looking for more money in this empire, if you want to call it that, and built all sorts of projects. But clearly, it just wasn’t fast enough.

As the economy grew over those years that we took over, we balanced the budget. We created confidence, a place where people wanted to come and invest. We had the opportunity for all sorts of people to come here. We heard the other day about the fact that a million new British Columbians had come to this province in that period of time. That’s a million new people. We’re just under about 4.8 million in the province today. Think about all the houses that are needed, the services and all those things. It’s a challenge. But to say that this crisis was caused by inept government policies is dead wrong.

In February, there was this announcement, a budget. In the period of time that I served, I know Finance ministers that worked…. We worked very carefully to make certain that we were…. We didn’t want to upset or destabilize the marketplace when we were making changes. As a matter of fact, when I first got elected, we’d just come through the 2008 financial crisis.

Everybody here remembers — right? — Bear Stearns, Lehman Bros., movies. We were coming out of that, and the fact was that nobody knew where the bottom was. The American economy — we didn’t know whether it was stable. Housing starts had plummeted from, literally, the seven-digit numbers in the U.S. down to the low six-digit numbers. It was a tough time for the forest sector. Commodity prices were down, and frankly, we didn’t know where the bottom was in that.

[3:00 p.m.]

The difference was that when we made announcements about the budget — Finance ministers, cabinet, the Premier — we were all very careful about making certain that we didn’t upset the market and that when we made an announcement, it was intentional. It was either to make certain we did something to slow things down….

Take the foreign buyer tax. It wasn’t something that we introduced and let percolate for a year or two and just kind of bring it on. It was talked about by many people. But at the end of the day, it was something that we brought in because we knew that there was the perception…. Maybe it hasn’t proven to be as huge a number, but the bottom line is that foreign buyers were investing here, and the perception was that they were making housing prices unaffordable. Supply is probably more to the answer.

I think that one of the things that’s flawed about Bill 45, and, really, going back to the budget, is here we have an impact that has been levelled on all communities in British Columbia by the fact of this slow, almost torturous kind of not knowing what the rules are going to be. What does it mean?

It’s happened in communities. Radium, Invermere, Cranbrook, Fernie — all of those bordering communities are sitting here in limbo wondering about what it is. What is this tax going to really do? Now, it’s not that the Finance Minister didn’t come out with the earliest kind of statement about the targeted communities and her justification about vacancy rates and the fact that there was this huge issue or crisis on housing. I’m not certain that that isn’t a case that shouldn’t be addressed.

However, I think that the approach has not only really decimated many of the communities, and I know I’m from one of them…. But the fact that one of the things that didn’t really happen in this time…. And I know that the Finance Minister said earlier today that she’s met with the communities, but listening and actually coming to what is considered to be consensus is different than just giving lip service and continuing to plod along with a plan. Frankly, the early warning signs were out on this bill from the get-go.

The fact is…. I mean, literally, the city of West Kelowna, which pushed back immediately when this came out, provided me with literally hundreds and hundreds of letters from people that own property in the city of West Kelowna. My office was flooded with thousands of emails and letters. I’m going to read a couple of comments from people all around. I’m not going to read all the thousands. You don’t have to worry. That would, I’m sure, keep us here well into next week.

Then I presented a petition that was signed by over 15,000 Canadians that had their comments. I have hundreds of pages of their comments here. But more importantly, the real essence of this and what was happening was that in the community where we’re trying to build…. The city of West Kelowna was only just over ten years old at the time this tax was announced. It’s trying to build its infrastructure.

We’ve got affordable housing projects that, essentially, were put on hold because of the fact that there was this huge amount of uncertainty. It’s not just because of the fact that they couldn’t do the math. They just didn’t know if the people that had been buying in the past would continue to buy or what would happen on the market.

We have many projects throughout our area, but not just in my riding or the MLAs for Kelowna-Mission or Kelowna–Lake Country. Vernon-Monashee — a huge development. I was there last Friday night looking at hundreds of empty, stalled homes. Basically, they’ve stopped construction in that riding because of the fact that the buyers that were there…. It’s about the uncertainty.

This goes back to…. When you go to sell a product — I have a bit of experience in selling a retail-type product — it takes time to build confidence and the fact that people believe in your product. They understand that you’re stable and the fact that…. I’ve always said that I want to be consistent in quality, make certain that the value is there and make certain that people feel that they’re valued, in terms of what it is that we’re producing.

[3:05 p.m.]

I think that that was the wrong message when this came out. How do we adjust that? That’s something that I don’t think we’ve done here today with some suggested, proposed amendments that are coming up.

I do think that one of the things that was quite striking…. Initially, the group that came and talked to us was the developers. They were obviously on the front lines. They’ve got projects in for rezoning. They’ve got projects that are either under construction or some of them that were already at completion.

The community, the MP, mayors, the development community came together and had face-to-face meetings in the very early stages of this, and of course, we couldn’t really do anything. I mean, we attempted to try to get certainty around this, and what ended up happening is that we have a community that is now facing not just the fact that the buildings have stopped, but they were finishing up projects that were already in the pipeline.

Now, what’s happened is that those people, the people that do the foundations, the framing…. The comments that I hear from the development community…. You know, I had a call from somebody the other day that does this particular specialized plasterwork, and he says: “When have you ever had a call from one of them that’s available, if you want to call it?” I don’t know if that really is creating affordable housing or supply, but certainly, it’s put a lot of people, and it’s going to put more people, out of work.

We saw the numbers recently, the end of September. The stats in Vancouver, across the province, were over 40 percent of a reduced number of housing starts from September 2017 to now. In most cases, that is a crisis. In the Okanagan, the number is 60 percent — 60 percent less new housing starts.

That’s how come, when we got to UBCM, all of the mayors and councils — maybe they were kind of a little bit uncertain when it first came out. They certainly didn’t want to give up on affordable housing projects. I know that they work hard to make certain that they come up with the right criteria, the property to make certain that the government and B.C. Housing are continuing to be interested in helping solve a problem that does exist across many communities.

But the situation now is that we haven’t really created more supply. We didn’t turn our attention to the type of product that we were actually looking for.

Maybe one of the things that we do want to address is the length of time that development actually takes to get to market. I see the minister nodding over there, and I know I was the minister, and I think that it’s the right thing to do. I don’t think that people that are trying to build and bring on supply should be held hostage to the bureaucracy that many of the local governments have formed around. The reality is that there are some good examples of local government that is really very purposeful in trying to get that done. But that still doesn’t answer the questions about the uncertainty.

Now, when this first came out, the members for Kelowna–Lake Country and Kelowna-Mission and myself had a town hall meeting, which was to try and inform people with the available information about what was happening and how this was going to work out. We had a professional accountant. We had somebody from the development community. This panel of experts, as we called them, were the ones that were there to present what they knew about how the speculation tax was going to be implemented, how the tax credit is supposedly going to work.

Even after reading the bill a couple of times last night, I’m not convinced that I understand how these credits work and the cap, etc. Anyway, I intend on making certain that I better understand that. But the more important thing about it is that it’s not understandable to the average British Columbian that is trying to make some sort of decision.

Now, the confusion with the title, as I mentioned earlier, is that it’s labelled a speculation tax. I don’t really think that this bill addresses speculation. It certainly puts fear into people that are building homes that they’re going to have this inordinate amount of tax that they’re going to have to pay when it comes to having a home, maybe, in the Lower Mainland and one in the Okanagan. They’re going to be faced with this incredible extra surcharge, if you want to call it that.

I think that what’s important is that British Columbians have been confused. They like the name, as the member for Powell River–Sunshine Coast said. They support that, but the problem is that they don’t know what they’re supporting. The reality is that this is not really addressing the issue if we want to address speculation.

[3:10 p.m.]

This eight-month period, this gap in time, has cost the province, I’m sure, hundreds of millions of dollars in forgone tax revenue because of the fact that it was ill-thought-out. Maybe, with some proper consultation, we could have got to an answer sooner about speculation and not disrupted the housing market. Whether it was going to stay the same, go down or not, the bottom line is it certainly wouldn’t be down 60 percent in West Kelowna and Kelowna.

I think that that lack of information has now started to manifest itself with real facts. We’ve got UBCM. We had a number of motions that local governments brought forward. You know how that process works with UBCM. Hundreds of motions go forward, but they don’t all get adopted. They don’t get on to the floor.

We’ve got quotes from resolutions. This is about local governments. A lot of these are not necessarily the ones…. Here’s East Kootenay regional district: “Non-resident property owners invest in our communities financially, are active community members, some coming here for generations, and many eventually become full-time residents.” Of course, many are the affected ones.

So far, what ended up happening is that, you know…. There are exemptions that came out in March, and those exemptions were…. I don’t know the rationale behind it. I don’t know if there was a consultation, but there was an exemption about the Gulf Islands, where lots of people have summer homes or whatever, and a little adjustment around Parksville. Certainly in Juan de Fuca there was an adjustment, and on the Saanich Peninsula — or the margins, anyways.

What I do think is that it really goes to the point that a more fulsome consultation on this type of tax bill should have been done long before February, and we should have had a chance to plug into that so that we could have made certain that British Columbia’s economy wasn’t impacted — families that are now going to be out of work because housing starts have dramatically dropped.

As some of the local government officials said at UBCM, “This is a direct job killer.” That’s Langford mayor Stew Young, who I think many of you would know.

“This is not just a housing issue; it’s tied directly to our economy.” That’s Oak Bay mayor Nils Jensen. This is kind of leading up to UBCM.

Mayor Findlater in West Kelowna, who has been not so quiet on this matter, says it’s a potential financial crisis.

“It should be eliminated altogether,” Nanaimo regional district chair Bill Veenhof says.

“People who picked up a modest place on the lake 20 years ago and kept it in the family are not going to be able to afford to keep them.” That’s again Mayor Doug Findlater.

“It’s the uncertainty that’s raising a lot of concerns and is damaging our economy. When people don’t know, they just sit and wait, and that’s not a good thing.” That’s Colin Basran, the mayor of Kelowna.

“I believe that this tax is a form of domestic piracy.” That’s a little bit more edgy, but that’s from the UDI chair, Kevin Edgecombe, in Kelowna.

I think that what’s important is these resolutions that were brought forward. Of course, the minister was there, as was all of cabinet and the NDP caucus as well as the Greens.

UBCM resolution C11 was brought forward by East Kootenay regional district “to allow local governments to opt in or out of the tax.” These are all past resolutions, by the way. I won’t go into all of the other stuff.

From the LMLGA executive, resolution C12, to “delay the introduction of the speculation tax in municipalities that request it” and “allow local governments to address such problems without resorting to a one-size-fits-all approach that the speculation tax embodies.”

Resolution C13, brought forward by the capital regional district “to allow municipalities to opt out of this new housing speculation tax.”

We also have C14, Nanaimo regional district: “…not implement the proposed speculation tax in the regional district of Nanaimo.”

C29, brought forward by Langford says: “Therefore, be it resolved that the city of Langford calls on the B.C. government to allow municipalities to opt out of this new housing speculation tax.”

[3:15 p.m.]

I think that it’s pretty clear that the mayors and councils went unanimously, not seven months after this was first introduced, because their communities were reeling from the impact of the uncertainty. The bottom line is that we are not…. Well, of course, we have certainty that we know what the bill today. We don’t know, necessarily, the amendments, which I know will be forthcoming. However, how do we get to the fact that communities that have…?

I know West Kelowna disputes the fact that the numbers that the Ministry of Finance is using for its vacancy rate are incorrect. I know that when this happened, there were almost 1,000 new units under construction right near my constituency office. Some of them are still unoccupied. Very reasonable rents. I checked on it at the time, and it was square footage between 600 and maybe 1,200 square feet and a cost that was affordable — just over $1,000 a month, up to about $1,700. I’m quite certain it’s a reasonable starting point, considering that I have a couple of hundred employees in the area, and I know what the wages are like in the area.

We talk about some the first things that we heard when this tax was announced. This was within days of the tax coming out, and I had letters in my office, as did my colleagues in Kelowna.

Mullins Design Group: “In the last two months, I had 12 clients cease their plans. That equates to an estimated $20 million to $25 million out of my small firm.”

McKinley Beach is a huge, I believe, 800-lot subdivision just north of Kelowna, obviously in an area that is not downtown in the highest-rent area. But it is where there is a combination of affordable homes. “We have already been forced to indefinitely to postpone the development of a townhouse project. This impacts hundreds of employees and is a direct result of the concern and fear of the unknown of this undefined speculations tax.”

Staburn Group, right in my own riding: “We are part of a group that own a large acreage at Goat Peak. We have worked for over a decade to get this comprehensive plan passed. It is a project exceeding 1,000 new housing units. We were about to submit a rezoning subdivision application for the first phase of over 100 lots, with roads and servicing costs estimated to be over $8 million. We have now stopped all engineering, planning and design work, and put the whole thing on the shelf until a change by the government. Ten to 15 professionals immediately impacted, hundreds more person-years of employment on construction, the largest housing project ever in West Kelowna.”

And many others. LedMac in Kelowna, a $250 million investment. Wesbild up in Vernon, $7 million — that’s the one with the empty foundations I was just up at on Saturday. Macdonald developments in Langford, 600 new homes and 110 lots in Kelowna, on pause. Belmont Properties, almost 600 market and rental properties — rental properties — on hold. Westcorp — I just confirmed this yesterday with the head of it that a $230 million hotel project, a mixed-use hotel project, in Kelowna is still on hold. They’re not going ahead.

The development community has been devastated by this. The building community, the contractors, the families, British Columbia families, are the ones that are going to feel this. They’re the ones that are going to be paying this bill. It is not going to be the speculators, as the government has suggested.

Interjections.

Deputy Speaker: Members. Members, let’s have one speech at a time, please.

The member for Kelowna West will continue.

B. Stewart: Okay. I know that time is running out. The bottom line is…. You know what? I’m sure the member in Nanaimo…. I’m sure that many of the people, although it’s not as active as maybe some of these communities, will be feeling…. Perhaps they’ll have that opportunity to finish those developments up in Nanaimo when we get this all sorted out.

[3:20 p.m.]

Here’s an email that I got recently from somebody that was quoted the other day. It’s a big group. They’re building a lot of affordable housing in the Kelowna area. Randy Shier, the president of Mission Group:

“Here’s an email from an Aqua supporter from out of province that I thought you’d like to read.

“‘Congratulations on moving things forward. I thought I’d just send you a quick note regarding the recently announced speculation tax and its impact for those of us who are non-B.C. residents. We have been interested in your development and were considering purchasing a condo for retirement down the road. The recent B.C. government announcement has caused us to pause and reconsider allocating investment into Kelowna and understanding the magnitude of the tax.’”

A second one here, from David Paisley:

“I’m a West Kelowna resident. I retired to B.C. after a long career in Calgary, and as you’re aware, Albertans have been long been valuable tourists and investors in this region. The unintended consequences of this ill-conceived speculation tax are enormous, and will do little to solve the problem of housing affordability in the regions it is targeting. In fact, thousands of Albertans have invested in the region with the long-term intent as a future retirement or family recreation property. These are not flippers who have distorted the market in Vancouver or other major centres.”

Those are just a couple of, some of, the ones that I think it is important that we hear from.

As many of you would know, the mayor — who is not running again in West Kelowna but has done a tremendous amount of work with his chief administrative officer, Jim Zaffino — has published a number of issues and updates on speculation tax and the impact that they’re feeling in West Kelowna. It’s a small community. It represents under 40,000 residents. It neighbours Westbank First Nation, where there are another 10,000 residents.

Between the two of them, there are vast tracts of undeveloped land — ALR lands, etc. — so infrastructure is a big deal to these communities. No one model fits all communities. One of the things they tout in this particular plan…. They’ve done exhaustive research. They came up with recommendations for the Finance Minister to look at — other speculation tax models, to reconsider the one that was being proposed.

Part of that, that they were talking about, was the fact that future tax revenues that they’re going to have to forego are going to impede the capital plans that they’ve already put in place. Some of them are under construction. There’s an over $40 million water treatment plant that is in limbo right now because, all of a sudden, the tax base is not certain as to how it’s going to move ahead.

I want to just conclude my remarks….

Deputy Speaker: Thank you, Member.

B. Stewart: That’s it? Thank you.

A. Weaver: Please let me start by acknowledging the remarks, and thoughtful remarks they were, from the member for Kelowna West. I hope to be addressing some of the concerns he raised in the process of him outlining some of the issues from his particular riding and some of the concerns he received, which were similar to some that I received. I also want to acknowledge the talk from the member for Powell River–Sunshine Coast who also brought some important information to this debate.

In this debate, I’ll say to start that I’m the designated speaker on this issue. I’m not going to be too long, but I will probably go just beyond the half-hour mark. I’m going to outline my comments in a number of ways, in a format that starts with a broad introduction to what I would argue is a crisis here in terms of affordability in British Columbia. I’ll follow that up with a little bit of a discussion about how the speculation tax was rolled out.

I think my comments will jibe with some of the comments made by the member for Kelowna West. In particular, I’ll highlight some statements made in the messaging early on and some of the subsequent changes that occurred leading up to the actual legislation being introduced. Then I’ll move, in my address, to discuss some of the concerns I’ve raised consistently, such as treating Canadians equally, as well as the concerns I’ve had with respect to meaningful consultation with local governments.

[3:25 p.m.]

Some of the concerns I’ve had are with the ability of some strata, for example, or some districts, that have no rental, secondary suite or tourist commercial zoning. So you can’t actually, even if you wanted to, rent out your unit because of existing laws, legislation or bylaws.

Then I’ll talk a little bit about some of the land-under-development issue, an issue that I spent a good deal of time on, as the member for Kelowna West raised, specifically with respect to the uncertainty that this created in the development sector. Some of the other issues I raised were the impacts on British Columbians who, frankly, aren’t speculators. I’ll go through a number of personal stories. I’ll then move towards the whole issue of reaching this agreement with respect to amendments that I’ll be putting forward with government, and trying to address how those came about, to provide a public record of the process.

Then finally, I’ll conclude with what I believe is critical: the need for ongoing monitoring of what’s actually being implemented, to ensure that we are not, as legislators, overly interfering in the market but rather that we ensure the purpose of this tax. This, fundamentally, is to recognize that leaving homes vacant in a market with zero vacancies creates a social externality that should be internalized, somehow, to those leaving the properties vacant, until such time as vacancy rates improve.

To the introduction of the housing crisis: without any doubt in my mind, there are a number of communities where affordability has reached crisis proportions. Those are, predominantly, the urban centres in our province, in particular, the regions of Victoria and Kelowna — Vancouver is the poster child of this issue — and Nanaimo. This is a crisis facing an entire generation of millennials, who literally cannot find a place to rent, who literally cannot afford a place to purchase, who are struggling to actually live anywhere near where they can work.

We’re seeing a generation starting to move away. We just had a community move into Oak Bay — the tent community, just yesterday — of homeless people in Victoria who cannot get a place to live. This is an issue that’s moving around the province. We’ve got, in talking to business, a crisis in terms of attracting and retaining highly skilled workers. If you talk to those in the tech sector, the single biggest issue for the tech sector is the attraction and retention of highly skilled workers. They cannot pay the salaries that other jurisdictions are paying, yet the cost of living has gone through the roof.

This isn’t a problem in parts of British Columbia. There’s no doubt that for some parts of British Columbia, this isn’t an issue, but certainly, in some of our urban issues, affordability has reached crisis levels.

We know the offshore money that has been flowing into our market — both in terms of speculation as well as through some nefarious activities that the Attorney General has been looking at — needs to be dealt with, but I’ve always argued that in doing so, in trying to treat the issue of foreign capital coming into British Columbia, we need to be sure that we protect Canadians and British Columbians.

Now the government’s approach was to introduce some­thing called a speculation tax, initially. It’s now changed, and I’m actually pleased with the change of the name. I think it’s far more appropriate. It’s now called the speculation and vacancy tax. The vacancy component is critical, because the speculation component, in my view, largely applies to the offshore money.

We wouldn’t have done this. I’ve already pointed out that the approach of our party would have been to bring in place a New Zealand–style approach — to actually say: “You know what? If you want to own property in our jurisdiction, you must be paying taxes here.” This is what New Zealand does, this is what Australia has done, and this is what many European countries do.

The idea here, of course, is that we are not living in a free market for investment in real estate and land. You and I cannot buy a home in New Zealand. We cannot buy a home in Denmark. We cannot buy a home on the coast of Mexico. We cannot buy a home in Australia. The idea here, of course, is that these other jurisdictions have recognized that when there are small, local population centres and seven billion people in the world, the influence of external capital on small domestic markets can be profound. This happened in British Columbia.

[3:30 p.m.]

Our approach was to be different from what was the government’s approach. We wanted to initiate that ban on foreign purchase. When I say “foreign,” it doesn’t matter what passport you own. It means where you’re living and paying taxes.

Now, we’re not government. There are three B.C. Green MLAs in this Legislature that got elected by 17 percent of the popular vote in British Columbia. We recognize that in not forming government, we are not able to actually initiate a ban, New Zealand–style, on foreign capital flow. But we’ve certainly supported, and I have certainly supported all the way through, government’s efforts to deal with some of the aspects of foreign money coming in, whether it be through dealing with money laundering, through the foreign buyer tax and, more importantly, dealing with the issue of satellite families.

Satellite families are defined in this legislation. We’ll be exploring that further at committee stage. These are families — where you might have one person in the family working elsewhere, paying all their taxes elsewhere — living in, say, Point Grey or Oak Bay or Vancouver-Quilchena in a $5 million home and declaring taxable income of $20, accessing our health care system, accessing our social services, accessing our education system but paying taxes in other jurisdictions which are not declared here in British Columbia.

To me, this so-called satellite family is actually…. Again, the cost of them actually being part of our society and living in these homes is not being internalized. The taxes are paid elsewhere, but the benefits are collected here. The government’s approach here — I wholeheartedly, and I have done so since day one…. This is dealing with the so-called satellite family.

Over the months, I’ve pointed out numerous concerns to government. This decision we came to today to introduce three amendments was not something that was taken lightly. I saw this legislation for the first time when it was introduced. Life has been such a blur with these…. It’s like burning the midnight oil. It could have been yesterday or the day before now. It’s just been one big, long blur, in terms of negotiation.

When it was first introduced, I saw this, and I was pleased with some of the additions. One of these critical additions was identified by the member for Kelowna West. As the member for Kelowna West pointed out, when government first introduced this speculation tax, I would argue the details had not been thought through.

One of those critical details was: what about development of land? What about, if you have accumulated some land and you’re going to build townhouses and condos to sell to British Columbians, to Canadians, and in doing so, you’re waiting for permits, waiting to actually ensure that you get construction built? It takes a few years. That is not speculation.

I am absolutely thrilled that after meeting with the UDI, developers in Vancouver, Kelowna and all across B.C. and bringing these concerns directly to government, our government listened, and government has actually included in here exemption, during the development of land, of a speculation tax. That was critical.

I suspect that some, but not all, of the correspondence the member for Kelowna West had with respect to uncertainty and construction on hold is a direct consequence of the uncertainty. We have now seen certainty.

I agree with the member for West Kelowna. It would’ve been awfully nice if, when the tax was first implemented or announced back in March, that certainty had been given to the market.

[L. Reid in the chair.]

I, like the member for Kelowna West, believe that market uncertainty is not a good thing, because you have projects going on hold. You have projects potentially walking. You have people then speculating on the uncertainty. So I completely agree there. But I am pleased that this has been dealt with.

Not all the concerns have been dealt with. Not everything has been addressed. I spent, after seeing this bill come out — I’ll come to some of the things that have been addressed — many, many hours. My staff spent many, many hours trying to actually get to a fundamental position where we could actually support the overarching structure of this bill, recognizing that there’s still work that needs to be done. I’ll also identify some of those things, and there is time to fix some of these things.

In my view, good government works when people work together. I recognize that it’s a much more difficult position for official opposition, and I recognized that when this government now was in opposition. It’s more difficult for official opposition to actually constructively work with government because of the setup we have in our legislative structure.

[3:35 p.m.]

As a small third party, we have a duty and a responsibility to British Columbians to be responsible with the so-called power, the so-called influence that we have. That duty and responsibility is to ensure that we listen and communicate our concerns and do what we can, through collaboration and compromise, to come to a situation, to come to development of good legislation, to policy that we think tempers some of what was introduced and reflects some of the concerns, but not all, that allows us to support the policy moving forward — with the recognition that this is not what we would have done.

What happened with the speculation tax and the budget rollout? Again, the member for Kelowna West articulated this quite well. When it was first announced, nobody knew the details. I didn’t know the details. The member for Kelowna West didn’t know the details. In fact, government suggested to the media — the Premier suggested — that British Columbians were fully exempt from the tax. I thought they were fully exempt from the tax. In fact, my constituency office sent out an email assuring my constituents and those who contacted me that British Columbians were exempt from the tax, based on the information I received directly from listening to the Premier.

Well, you can imagine I was a little bit surprised when I read Vaughn Palmer’s article pointing out that I was sending out incorrect information. He was right, and I acknowledged he was right. He was right in that an information bulletin had been put out that was inconsistent with the messaging and the language that had been said by government. This is not good for certainty.

This was, quite frankly, from my perspective, somewhat embarrassing. I don’t like to send out wrong information. We did our best to correct it, to do that, and, at that point, realized that we were going to have to spend a lot of time on this file.

We started pushing government to fix some things. We recognized that the issue of the housing crisis is not a rural issue. It is largely an urban issue. So in the act, you’ll see that, for example, we pushed to get some of these islands out. There were islands in the Nanaimo regional district — which was excluded — that had no electricity and no power and no rental market which were included because of what was done in the metrics to determine it. They were used, basically, over broad, regional districts instead of over urban areas.

What we were able to do was to get government to focus this initially on the urban areas, where there is more of a problem. Some areas, like Saltspring Island, do have rental issues. However, it’s a very complex issue there, as well, and ongoing work with the rental task force, I understand. My good colleague here from Saanich North and the Islands will be discussing that, I’m sure, when he speaks to this bill. There are issues that still need to be worked out.

In March, government announced a few changes that it had made. These included reducing the rates for British Columbians and Canadians, and ensuring, in particular, that the tax didn’t apply to rural and vacation areas. One of the issues, again…. This was very relevant to the member for Chilliwack-Kent. Cultus Lake, in the initial version, was included. I think Harrison Hot Springs may have been included as well.

Again, these we pointed out. We directly took the emails from your constituents — I’m sure you probably did as well — do not pass go, to government, saying: “How does it make sense for Cultus Lake, which is not an urban centre, for Harrison Hot Springs, to actually be included in a speculation tax, when their markets are quite different from, say, South Surrey or Tsawwassen or Burnaby or Nanaimo or Victoria?”

So government did remove much of the rural aspects and focused on the urban. That was signalled out in March.

Even since then, I pointed out that I’m struggling, because the speculation tax was first introduced in the budget. I’ve heard scores and scores of stories of individual cases, over the last eight months or so, of people who’ve asked: “Am I included? Am I not included? Am I here? Am I not there? What does this mean?”

This took a lot of work, honestly. It took a lot of work to try to put together a detailed understanding of the complexity of this issue, of the complexity of what government was trying to accomplish with the introduction of a tax that essentially says that we want to create an internalization of that externality associated with leaving vacant property in areas that have low vacancy rates.

[3:40 p.m.]

Many of these examples were brought forward. Many, many meetings were had. But the issue, of course, was that we didn’t know to what extent government was listening. We didn’t know to what extent government was listening until this bill was actually introduced, sometime in the last 72 hours, which have been a complete blur to me based on the fact that…. When was it?

Interjection.

A. Weaver: Tuesday, thank you. This was introduced on Tuesday.

When this came out, I was, as I mentioned, glad to see that government had listened — in many, but not all, examples. For example, there were exemptions for people who obviously should not be hit, where being hit with the tax would cause significant financial hardship. Some of the specific cases I raised to government were included. For example, people that own a second home in a city because they need medical treatment. There are people in British Columbia who have to go and own a home in a particular area because they’re required for medical reasons to come and report periodically to that area. They have been exempted.

People who have secondary suites. For example, if you are in the community of Kelowna West and you live in Alberta and use your home in the summer but you have a secondary suite on your property, that secondary suite would grant exemption for the entire property. This isn’t without its own problems. For example, in the district of Oak Bay, where I am from, or where I represent, rather, the district does not allow secondary suites. So there are some issues there that we still need to canvass.

Government listened in terms of examples brought forward about couples who own two homes. One home is where one spouse works; one home is where the other spouse works. They don’t work in the same city, but they’re still together. It seemed outrageous to penalize married or partners who happen to come together and formally, you know, take vows and commit to marriage — to penalize them because they had two properties, one of which was being used by one spouse and one by the other. Government listened.

The issue of strata properties, areas zoned as tourist commercial, where you can’t rent out places. Again, government listened. Lands that are vacant or under development. Again, government listened. I’m pleased that the UDI, whom I met with numerous times on this file…. Anne McMullin recently said that when they saw the legislation, they were pleased that government committed today that they will exempt lands under development from this tax. So the UDI is actually pleased. This is a very, very important exemption, because we cannot address affordability if we start passing on a speculation tax to purchasers of condos and townhouses which were actually being built for affordability purposes. It’s a good government lesson there.

There are still issues to deal with. Let me go through a few personal stories first, because I think it’s important to get a sense of some of the issues that I’m going to canvass more extensively in committee stage. Committee stage, as is known in this House, is critical for us to get interpretation of this legislation for broader application. There are some real subtleties as to how this tax will be introduced that government obviously has yet to capture.

In a briefing we had on the introduction of the tax plus some hours in 72…. Again, it’s been a blur. I was asking some of the issues directly in the briefing. It’s clear that government has attempted a commonsense approach not to harm people who are not speculating. However, there are going to be examples that have yet to be dealt with. I can think of one example that needs to be discussed where, for no reason other than you’ve actually got a house that’s old, your house happens to be built on two city lots. In terms of the registration of your city lots, you have one house, but there are two lots. It doesn’t make a lot of sense to pay a spec tax because 100 years ago the lot zoning was the way it was. So there are some oddities there where we have to look out.

I don’t know to what extent there are other jurisdictions out there where boundaries of actual lots span multiple zones. For example, there are houses in Oak Bay that have some of their property in Oak Bay and part of the property in Victoria. Now, to what extent does that exist in the province of British Columbia on the edges of the areas covered? I’m sure there are properties in Nanaimo, in the CRD, in Kelowna West and elsewhere where most of the property is in the contained area but some of it isn’t.

[3:45 p.m.]

These are issues that government may have not yet thought through and hopefully will be canvassed during committee stage to get some clarification.

I’ve had people who own a house, a strata building that doesn’t allow rentals, contact me. I’ve had people who’ve invested in Victoria, in places that are zoned tourist commercial — specifically designed for short-term rentals. The zoning actually requires short-term rentals and doesn’t allow long-term rentals.

Again, this was partly dealt with in this legislation, essentially by saying that in the affected years 2018 and 2019, these areas — tourist commercial–type zoning or stratas with no rental clause — are not going to be subject. I still have issues there with respect to secondary suites in municipalities that don’t allow secondary suites officially to be zoned. Can you officially declare a secondary suite when, officially, you’re not allowed to have one? There are issues there that I hope to canvass.

I’m hoping that my good friend from the riding of Vancouver–West End and also my good friend from the riding of Saanich North and the Islands will be thinking about the issue of stratas and actually whether or not we in British Columbia are getting close to getting to where Ontario already is. In Ontario, you cannot actually have a no-rental clause, a long-term rental clause in a strata. Stratas are empowered with the power of eviction. That’s important. You can say — and it has been tested in court — no short-term rentals. But you cannot own property and put a no-rental clause on it.

I’m hoping that this committee takes a good, hard look at that because it is an issue. It’s an important issue. If you’re going to apply a speculation tax on somebody because they’re not renting it out but the strata has said you can’t rent it out, there are two components here that are important. One, there’s a real investment opportunity here for British Columbia. If we’re able to invest in new construction in strata units that allow rentals, there’s an ability to attract capital to our province to create new investment. But secondly, there’s a lot of stock in the market that potentially could be sold, if people are friends of this speculation tax, and that would otherwise not be sold and would be rented out. So it’s win-win-win, if we start to think about this in greater detail.

One of the other issues I’ve had e-mails on is…. There have been issues with respect to transition of home ownership. I’ve had couples who own two homes, in the midst of trying to sell one and move to another. One example was a constituent that had a house in Surrey, moving to Saanich. Actually, the housing crisis in our area is largely associated with people saying: “I can cash in, in the Metro Vancouver region and get a lot more over here and live well thereafter.”

This particular family had a house in Surrey and one in Saanich. They wanted to move, both areas subject to a spec tax. They were concerned that in trying to sell their home, they would be subject to a spec tax on one of their homes. Well, in fact, here we have that transition clause, which I think is important to canvass further in committee stage but which does address this particular issue.

I’ve had similar ones with a couple coming from Kelowna, moving to Victoria. Again, same thing. We seem to get a lot of people coming to Victoria to retire, and they’ve lived in other parts of B.C. They’re really worried about selling a home in one place and buying it in another. That transition amount is actually critical there, and we’re seeing that legislation brought forward in what we were shown on Tuesday.

A couple of people have told me similar stories, from the Kootenays, buying in Victoria to retire here. They recently bought. They’re worried that they’ll be hit by a speculation tax. Their child is actually living in the home now, but they’re worried that they’ll be subject to this. There are issues here with respect to whether or not that arms-length or non-arms-length allowance of the son living in the house while he might be attending the University of Victoria, for example, while they’re planning to return, was considered speculation or not.

[3:50 p.m.]

It turns out, again, people like this have some coverage as per the legislation. Again, we have to canvass this further in committee stage.

One of the most profound issues brought to me was Canadians saying that this is not fair. “I am being taxed at a different rate living in Ontario, compared to living in B.C. Why is it that the rate is 1 percent for me in Ontario to one-half a percent for me in B.C.?” This one really struck at the heart. I’m a Canadian first, I’m a British Columbian second, and third, I am actually a person from the riding of Oak Bay–Gordon Head. We are all Canadians, and to me and our party it’s critical that we treat Canadians equally.

One of the issues here that really took midnight oil being burned was working with government to ensure that they recognized that the tax rate for British Columbians and Canadians — making that difference was simply not acceptable.

This, again, will not deal with all of the issues raised by the member for Kelowna West, but I can say that when it goes down from 1 percent to one-half a percent, that actually affects a lot of decision-making for people that I know who have homes in West Kelowna but may live in Alberta and spend four months of the year there. The one-half a percent makes a significant difference in terms of the amount that one would pay. It’s not perfect. It’s not what we would do, but it’s significantly less than what it would otherwise be.

One could argue, as government does, that what it’s doing is while it’s still encouraging development through this exemption of land under development, at the same time, it’s saying: “You know what? There’s an external social cost to developing property that is vacant that needs to be internalized by those who leave the property vacant.”

That external cost now is not differentiated between the rate…. It’s not differentiated between British Columbians and other Canadians. That is one of the amendments, which I’m working on now with legislative drafters, that we’ve kindly been given access to through this government to ensure it’s brought forward at committee stage for this bill.

I agreed with these Canadians. They pay taxes. They may not have paid taxes in B.C., but they pay taxes in Canada. I have a problem with the way the taxation system is in Canada, and we can come to this more in question period. I’m sure we will. Right now we know that a lot of people retire in British Columbia. Part of the reason why we have an affordability crisis is that we are the destination of choice in Canada for retirement.

If you look at the amount of money spent as a function of age in the health care system, it’s also really clear that you spend more as people get closer and closer to the end of their life. The older they are, the more they cost the health care system. We also know that the demographic of places like Vancouver Island and B.C. as a whole is older than other jurisdictions in Canada. So people are paying taxes in other jurisdictions and accessing our health care system here, but our Canada health transfer does not recognize age. It is not weighted by age.

Our Canada health transfer shorts British Columbia to the tune of $200 million to $300 million. Based on a simple calculation, we should be getting age-weighted cost transfers, not per-person cost. Had we been getting $200 million to $300 million more in health care transfers under the Canada Health Act, we’d have $200 million to $300 million more we could put directly into health care.

It means $200 million to $300 million more not coming out of other budgets and going into health care. It means we could have been spending $200 million to $300 million more in affordability and housing every single year. This needs to be dealt with, and this is something we will continue to push on in the years ahead.

I’ve had lots of people contact me. I have a good deal of sympathy for the member for Kelowna West. I’ve had a good deal of his constituents contact me as well. I understand some of the issues that are there, and it’s put us in a very difficult position. We’ve done many, many hours of trying to ensure that we reflect the values that we’ve been trying to instill, that Canadians are treated equally. I’ll come back to that, that the mayors are consulted, as well as that money stays in the local community.

[3:55 p.m.]

Examples I have been given…. One: there are two professors in a family. They’re not hurting financially. One professor works at UBC, one professor works at UBC Okanagan, and they have two places. They were both initially living in one place, and the other would have been treated as spec tax. They were getting very confused. Now we have a recognition that with married couples — there is an exemption for them.

Again, I had a very compelling email just today from a woman whose family home is in Surrey. Yet this woman was a teacher who worked in downtown Vancouver. This family home in Surrey had her elderly mother staying in it. She didn’t want to sell it. Clearly, it was in her name. But she had a condo in Vancouver because she couldn’t fathom that commute every day to teach in the elementary schools or the school system in Vancouver. So she stayed in a condo during the workweek and lived with her mother in her home on the weekends and during the summer. The question is: would she be covered under a spec tax?

I’m virtually certain, based on the exemptions that have been put here based on government listening to the numerous feedbacks that have been given to it, that they will not be covered. They are exempt. Again, I’ll explore that story in detail during committee stage.

I could go on and on with other stories. But I think, hon. Speaker, you’ve got the point that in fact, there are many examples — secondary suites — that can’t be listened to, that have to be dealt with, and so on and so forth. The stories are endless. Again, I’m sure other members opposite will provide more stories. I believe the member for Chilliwack-Kent may be speaking very shortly. I’m sure he has similar stories to offer as well.

The concerns I’ve had, coming back to this issue, that have not been addressed in this bill as of now, I have highlighted on an ongoing basis over the past eight months. Honestly, this bill does not deal with flipping. It still doesn’t deal with somebody who buys a home, leaves it vacant for nine months, flips it out — they’ll have to pay a capital gain — buys another home and flips it out.

We’re not dealing with flipping here. So we’re going to continue to actually do what we can to ensure that this aspect of speculation is actually looked at. We’re collecting data now on British Columbia in terms of the presale of condos offshore.

Again, we’re not dealing with some of the aspects of presale flipping as well. There are some that can occur. I know that members opposite, the Leader of the Official Opposition, introduced a private member’s bill that would require the flipping of a presales condo. If you actually did that, you’d have to report 50 percent of the actual profit as income.

That, with respect to the Leader of the Opposition, isn’t going to do anyone any good because, essentially, that bill says, “If you’re going to break the law, you shouldn’t,” because you already have to declare 100 percent of that flipping income as a capital gain.

This isn’t dealing with the actual issue. We need to have realistic solutions. That is the difficult position we’ve been put in as a small, three-member caucus working in between two large parties, one which is government and one which is not. We see our role as working to ensure that government policy is better, at the same time as doing what we can to continue to move forward this issue to deal with some of the real aspects of speculation.

Government has taken some steps with respect to hidden ownership to get at trust, beneficial and corporate ownership. We, frankly, don’t think they’ve done it as aggressively as it should be done. We know that government has taken steps to actually deal with potential money from nefarious activity entering real estate. We don’t think they’ve done it fast enough. We have been pushing for more progressive action on no rental clauses, with, of course, the provision that the power of eviction be granted to strata.

Government, we think, also needs to ensure that people know that they’re dealing with a commonsense approach in this legislation. We haven’t given up on this.

In the briefing that I had yesterday, plus some hours the last little while, one of the questions we asked is: what is the intention? You’ve made these changes. Why these ones and not these ones? The information I got, which we hope to explore further in committee stage, was that government is trying to take a commonsense approach to ensure that most people who are just regular people are not captured by this speculation and vacancy tax.

[4:00 p.m.]

It’s really targeting the overall goal of affordability, which is when you leave homes vacant for no other reason, you’re creating an externality of social cost that is going to be partially internalized.

We know one of the things that does exist here is that in the legislation, there is an appeals process that exists. But again, appeals processes that aren’t publicly brought forward — aren’t communicated, aren’t demonstrated — will not be known about. So we’re pushing to ensure that the public understands that they may have certain criteria that government hasn’t actually realized exists.

The one I just gave an example of is a property that may straddle two regions. I’m sure there are some, because there are properties in Oak Bay where half the house is in Oak Bay and the other half is in Victoria. Go figure that one. But they exist. There must be properties on the boundaries of some of these urban areas that have similar issues.

There must be a mechanism that people know of so they can bring these issues forward and get a response in a timely fashion, subject to the commonsense kind of approach of ensuring that regular people are not being hurt.

With that said, after reading this bill, after going through many months…. This has been not just one or two meetings. It has been months. I’m sure, again, the member from West Kelowna, as somebody who’s quite passionate on this file, has also spent many, many hours on this file. After many, many hours, seeing this legislation…. In my view, in our view as a caucus, it still needed to go further. It still needed to go further in three more ways.

Over the past number of months, inspired by those myriad stories in my in-box and the many conversations with people in industry, with homeowners, mayors of affected areas, I’ve consistently raised concerns with government’s proposed approach to the speculation tax.

In particular — I say it again — I had these three critical areas. The first is the need for local governments to have a more significant role in determining what happens in their communities. The second is the fact that Canadians should not be paying higher rates than British Columbians. The third is the need to limit the unfair impacts on Canadian homeowners who are not speculators.

Again, these have come through the myriad stories, the hard work…. I thank the constituents, the other British Columbians, the member for Kelowna West and all of those people who emailed from across Canada for their input on this.

I do regret…. I agree, again, with the member from West Kelowna that the uncertainty that has been created has not been helpful, has not been helpful for the investment in Kelowna, has not been helpful for investment in the capital regional district.

However, I think today we have certainty. We have certainty in the legislation in terms of the land being developed, we have certainty in terms of our support for this legislation — subject to government’s supporting the three amendments we’re going bring forward — and we have certainty in allowing us to move forward.

Let me come to the three amendments, and I’ll speak to each of these, that I’ll be bringing forward, in detail.

The first amendment requires mayors from affected municipalities be part of an annual review process with the Minister of Finance. Now, at cynical first look, you might think that that amendment is just saying: “The minister has to meet with mayors.” That is not the intent of the amendment. The amendment will be far more thorough than that.

I’ve publicly said that I would’ve preferred to have a local government opt out automatically. We would’ve done that. That would’ve been our approach. We brought that into conversations. I recognize that that would’ve given the mayors and communities a clear channel to making a case, based on evidence, as the member from West Kelowna has done with the commissioned report that they have from West Kelowna. That evidence would’ve been able to show how tax applied to their communities. We would’ve then allowed them to opt out.

What we’ve done instead is say: “Okay, government, you say you know best. We understand where you’re coming from. We have the same shared value. But we critically believe that you need to ensure that you have metrics — affordability metrics, rental vacancy metrics — that you actually put together in a meeting with mayors every year to ensure that the ongoing application of the speculation tax is done through consultation — with data, with evidence — with mayors annually.”

[4:05 p.m.]

It’s not just about a meeting. It’s also about the metrics that must be brought and argued at a meeting, and we’re grateful that we’ve got the full support of the minister on that. That comes from a case where no such meetings, other than informal meetings, were going to occur. That was the position of government, to our position where we wanted a full opt-out. That was where we ended up.

Now, why the role for local government is critically important — and why the annual review process must ensure that government is looking at community impacts and considering whether vacancy and affordability metrics within affected communities warrant removal of the tax — is that communities know best what is in their best interests.

I recognize that now is an odd time for this discussion, in light of the civic elections occurring in two days. But once the dust settles from those civic elections, it’s critical that mayors and new councils or incumbents actually have informed discussions with government, informed by metrics that are relevant to their communities.

The second amendment put forward here is a requirement and a recognition that we did not want this to become a tax grab, basically a central government tax grab for broad, undefined housing affordability issues. We felt that if you’re going to go and have money raised in a community — in the community of Nanaimo, Kelowna or West Kelowna — that money needs to stay in that community. That money should not flow back to revenue of government coffers.

In fact, that money — the reason and the justification for this tax — is, in essence, an internalization of that social externality caused by the preponderance of vacant properties. It’s important that you use that revenue in a neutral fashion to actually offset and deal with the affordability issue.

We’re pleased to come to an agreement on that issue, in that while there was broad recognition in this legislation that it will go to broad affordability measures, here it’s very specifically, in the amendment that we’ll be bringing forward, going to direct affordability issues in the communities from which the money arose.

The final amendment that’s being worked through right now will be to equalize the rates that Canadians and British Columbians pay. It’s saying that if you’re a British Columbian or another Canadian, you’re Canadian first. You’re all paying the half percent.

Again, this is an important issue of fairness, from my perspective. Punishing Canadians in a differential way like that didn’t seem to be fair. Again, we know that this will meet…. In some of the exchanges I’ve had with people across Canada, people don’t mind recognizing that there is an externality there that they can internalize with this small extra, additional tax. They recognize that. They recognize they’re not paying provincial taxes here, perhaps, and they don’t mind paying a little bit more. I’ve got examples where people have said that.

However, they do mind egregiously being charged twice the rate as British Columbians, because they ultimately are Canadians first. We agreed with them.

Government didn’t want to move on this. Government did not want to move on this. This took a lot of work. This amendment is actually being supported by government, but it’s not without government, essentially, having to compromise on the intent of this, because government came into this very much trying to differentiate between those who live and pay taxes in B.C. and those that live and come to B.C. We felt it was important to treat Canadians the same.

Again, coming back to it, this bill is not how I would’ve approached the issue. It’s not how the B.C. Green caucus would approach the issue. But with the amendments that we’re bringing forward, and the work done that has been done by government to limit the impacts of this tax on Canadians who are not speculating, I feel, at this stage, subject to the approval of those amendments, that I’ll be supporting this legislation.

There are still key elements in this bill, such as implementing the tax on satellite families and foreign owners who do not pay income tax in B.C., that I’ve always believed are critical to support. In fact, the government, I don’t believe, has gone far enough. We need to crack down on foreign money flowing into our real estate market, pushing housing far beyond the reach of ordinary Canadians.

[4:10 p.m.]

There are 4½ million people in British Columbia. There are seven billion in the world. There’s an awful lot of capital out there looking to park itself as an investment in this province in real estate solely for the purpose of speculation. Here, in our caucus, we think that that actually needs to be clamped down on even more than is being done.

The components of the tax that deals with foreigners and satellite families — always supported that. We believe that this will have a significant impact, as articulated in the bill, in terms of dealing with this issue. With that said, one of the key aspects of this legislation is that we need to have ongoing, continual, rigorous monitoring of what is going on in the housing market.

My worry is…. We all know the issue of supply and demand. Right now we know that there is not a lot of supply in the rental market. In fact, there is very little supply in the rental market. We have begun to see increasing supply in some of these urban areas in the market for sale. We’ve started to see a softening of demand in some of these areas. It’s not so much the low end, but at the high end of the market, a softening of demand. The very careful step in monitoring that needs to be done as we move forward is to ensure that in a time of reduced demand, we don’t suddenly initiate a massive influx of supply, because that can lead to market instability.

What I mean by that is we’ve got to ensure that the communication to those people who are being exempted here, communications to those people about the importance of an appeal process, the importance about a process to ensure that situations that may not have been thought through can still be addressed. People who are in no-rental clauses — the communication to them that there are two years, and government has two years to get to the bottom of this. For people who are in tourist commercial zoning, who recognize that there are still two years to come, to play, before government has to fix this. This needs to be communicated so we don’t see people rushing to sell properties out of lack of knowledge of what this legislation is actually doing.

At a time of decreasing demand and slightly increasing supply, if you put in a bunch of supply, it’s troubling. I’m pleased, in the discussions and the technical briefing we had with respect to this bill, that government is committed to doing this ongoing monitoring, and the ministry staff are committed to doing this ongoing monitoring. I, too, will be watching closely the market and how this tax affects the market in the months ahead.

My hope is that the amendments will give us some tools to ensure that local governments have a clear role in a review process on an annual basis, to ensure that we’re having evidence flow into the decision-making going forward, to ensure that uncertainty is removed from, actually, this decision-making process, to ensure that we actually can move back towards a situation where developers in Kelowna, Victoria, Metro Vancouver and Nanaimo have confidence that they won’t be hit with escalating costs to produce, knowing that they’ll end up producing supply that will not be actually ever purchased because the cost will be too much.

It’s critical that we monitor vacancy rates. It’s absolutely crucial in these meetings that happen with mayors annually that vacancy rates are monitored. If we move suddenly to the removal of no-rental clauses, and we see, for example, the sudden construction of thousands of units on a university campus for students, we might see an increase in rental rates, an increase in rental rates such that you can’t rent your property. So it would seem unduly punitive if you’re paying a tax for not being able to rent a property because there is no demand for it.

Again, the critical aspect of this is monitoring in an ongoing fashion. The enabling legislation does allow for timely order-in-council responses to this, which again is important and something that we felt was important to communicate.

It’s critical that while we seek to improve affordability for British Columbians, we ensure that in doing so, we take steps that do so responsibly and avoid a significant market downturn.

With that, I’ll say…. While again coming back to the overall summary of this, this is not something we would have done. I will give government credit for listening in many areas we brought to government. I think we get a little bit closer with these three amendments.

[4:15 p.m.]

I recognize it’s not exactly what we would have done. I recognize that members from the opposition may have gone farther, but I think, at this juncture, this bill, as amended, will be something that the B.C. Green caucus will support, and we’ll be watching carefully as we move forward.

R. Coleman: I am pleased to enter into the discussion about this bill this afternoon. I know the member opposite who just finished had a number of new names for it he thought he would change. And a new name he did, finally, somehow get through. Probably not the greatest negotiator, but he did get a name change to a bill that he hasn’t changed at all.

The reality of this is this. If you’re actually going to give this bill a name, it would be an inheritance tax act. That’s what it would be. It’s a tax on people who have worked hard to try and get ahead for their family, their children and their grandchildren. Can you imagine if, all of a sudden, tomorrow the government of British Columbia said: “We are going to have a mutual fund in your pension plan act, and if you make any money in your pension plan that you might be needing for retirement in there, we want to tax it”? That’s what they’re doing here with regards to somebody who actually has a secondary residence.

Some people put their money in the market. Some people put their market into gold or silver or mining stocks. Some people put their money into banks. Some people actually think that real estate is not a bad investment. If you’re patient and you wait, maybe someday you will be able to use that asset to help you have a retirement or, maybe even a bit better, have something that you can pass down to your children or your grandchildren.

This isn’t a speculation tax. It’s got nothing to do with speculation. It’s got to do with reaching your hand into somebody’s pocket and taking money out of it.

One of the things that hasn’t been discussed much around this particular piece of legislation is this. It’s gerrymandered. It’s a gerrymandered piece of legislation. Let’s talk about what that gerrymander is. The member for Oak Bay–Gordon Head, who just spoke, last spring bought his ideal retirement home. And he bought it in Parksville. Now, isn’t it incredible that he would have been paying $13,000 in speculation tax on that secondary residence, but whoa, after the announcement in March, Parksville gets eliminated. Imagine. All of a sudden, this confidence and supply agreement is all about a supply agreement for the leader of the Green Party. Imagine that.

Then let’s look at where else we are. Let’s look at Saanich North and the Islands. Oh, it was in. It was in. It was going to have to pay speculation tax. Now, why would it be that Saanich North and the Islands would come out? Would there have been the removal if the member for Saanich North and the Islands was from something else than the party that was in the confidence and supply agreement? Or is it because the member for Saanich North and the Islands, with his other two buddies over there, got upset and wanted it out? And it’s out.

And wow. Juan de Fuca, the Premier’s riding, was in. It was in. It was going to get a speculation tax. Now it’s out. So if the poor member from West Kelowna wants to do something, maybe he can convince the other Green Party member, from Cowichan — because it was never in — to move to West Kelowna, and I’m sure, in the confidence and supply agreement, a deal could be made to get West Kelowna out.

This stinks. This smells, and smells to high heaven as a deal that was made that actually benefits people. And that’s wrong.

[4:20 p.m.]

I can tell you this. As you go through and you listen to the bafflegab that I sat here for almost an hour to listen to, about the great negotiations to change the act and do the things it would do…. What the member was concerned about — none of it happened. In the press release today, they decided to do a couple of little changes and go out in the Rose Garden at the Legislative Assembly. By the way, that was one expensive press conference, if you saw the cameras and the speakers and the big stuff and all the equipment out.

Rather than do it in front of a blue curtain today, they probably dropped $50,000 to $60,000 so that they could go out there and stand in front of the cameras and say: “Look at us. We’re together. We just decided that we wouldn’t just screw everybody up. We’re going to continue with this tax, go into everybody’s pockets — everybody in the province — and take money out of their inheritance, from their children and grandchildren.”

These guys get into some of the funniest conversations.

Speculation tax. So what is speculation? If I buy a condo, and I live in it part-time in the year, and it goes up in value over the next five or six years, and then the market crashes, and it goes down, does anybody recognize the fact that I took a risk to actually decide whether I could or could not lose money?

They’ve got this airy-fairy idea that if anybody buys a secondary home or invests in something for the future of their family, they’re speculating. I can tell you this. They will not rebate their tax on people who have bought properties that will see their value go down — simply because of their failed process in the first place.

Look at this piece of legislation. Look at what’s happened since it was introduced in the spring. Around $600 million in construction in Kelowna alone has gone on the shelf. Now, this is really good, because these guys don’t get this piece. They’ll say: “People have presales, and they’re speculating on presales, and we want to stop that.”

What they don’t realize is that there’s not a single housing unit that can be built in the province of British Columbia — and anything multifamily — unless there’s at least 70 percent of the building presold. There’s no bank. We’ll lend the money to build the building. They also don’t say: “Well, what if you put in that money, that down payment, to buy that unit, and two years from now, the price goes down?”

You know what happens? You’ve put down a substantial deposit on that property. You have to close because you’ve made a contract. And they’ll call that speculation. The speculation is: “I want to have that home in two years. If the price goes down, I can get stuck.” And if you get stuck, government doesn’t care. They just want to tax you on what you have done for your family and your future.

I have people that I know, who have, for decades, had secondary homes that they bought in the Okanagan, in the area where these people are taxing, or Vancouver, where these people are taxing, and they did without to try and get ahead. They bought a place that they could go with their children. In some cases their grandchildren, and in some cases their great-grandchildren, have grown up being able to go to these places for generations. And all of a sudden, they’re speculators.

All of a sudden, because they made a decision to do something for their family, they’re no longer just normal, everyday, fairly treated British Columbians. They will be treated differently because of their particular status.

I’ve got to tell you, this whole notion of the attitude that they have about “people shouldn’t have this stuff….” They forget that if people didn’t make those investments, the housing wouldn’t have gotten built in the first place, the money wouldn’t have flowed into the economy, and they’d be looking at a worse situation than they are today.

I can’t understand the thinking sometimes of the NDP. I am shocked at the capitulation of the Green Party.

I can tell you, I listened to the bombastic outburst that says: “We will take the government down. We will have an opt-out ability for communities. We will get this done because we hold the balance of power.”

[4:25 p.m.]

Today, trudging out into the little rose garden, the Green Party leader, along with the Minister of Finance, had the announcement that they’d come to some great, great deal on the speculation tax. It was a sellout; it was just a give. So if you ever hear the Green Party leader again say, “I’m going to stand up against something that the NDP is going to do,” don’t believe him. It’s not going to happen, simply because he’ll get into the room and say, “How about we just change the title? Maybe the title will work, because it’ll look like I’ve done something.”

Maybe we could change a little tiny thing here and a tiny thing there, but no way are we going to have the opportunity for the opt-out promise that this member made. He’s not going to bring an amendment to that effect into this House. He’s going to sit there with amendments that, quite frankly, don’t change much of anything, but he will go out there and try, probably on his Twitter feed, to be able to convince people that he accomplished something today.

The truth of the matter is this. Housing starts are down by 42 percent. That means fewer condos, fewer townhouses and fewer other types of buildings will be built for people to live in. We have people in-migrating into this province, and the population is growing. It doesn’t take a rocket scientist to understand that when you have more people coming and you’re killing supply, there is no way that the prices are going to actually adjust. They’re actually going to go back up again. That’s what’s going to happen. It’s interesting to see how people don’t understand that. They think that by making some law and taxation, they can actually change this stuff.

Now, there are people that have given their opinion about this particular tax and what’s going on. They’re the very people who are actually running for election on Saturday. They’re mayors, councillors, people in communities who are sitting there saying: “You know what? This is not good for my community.” For instance, Mayor Stew Young. I’ve met Stew, and everybody else has probably met him too. He’s pretty straight-up about his thoughts. He doesn’t really leave you questioning what his opinion might be.

He says that Parksville, Qualicum, the Gulf Islands and Juan de Fuca were in, but now they’re out. Whistler and Squamish, despite their high housing costs, have never been in. Communities like Langford, Nanaimo and West Kelowna have their concerns, but they go on deaf ears. During all this time, the province has not actually facilitated meaningful dialogue with any of the communities affected.

Now, Stew is in. He knows what it’s doing to the housing market in his community, because he has seen it. He’s already seen hundreds of units cancelled in his community that aren’t going to get built. To continue to have some supply so that he can have some affordability for housing in Langford — he thinks that it’s important. But nobody’s listening to him on the government side, because they don’t want to know the truth.

You’re left wondering sometimes, when you see these things. They come up with a piece of legislation, and they do this stuff, and they put a spurious name on it — like the school tax one that they did, which was really just a tax on value. They do this, and they won’t come out and tell you the truth about the philosophy of the NDP.

It goes way back. I remember an NDP member telling me this: “We don’t have a deficit. We’re going to have the largest transfer of wealth in Canadian history, from people who have homes and assets, to their children and grandchildren, and we’re just going to tax it on the way through.” There’s $150 billion plus in debt-free housing on the Lower Mainland that will be transferred, in estates, over the next ten years, for people just over the age of 65, and that will go to children, who’ll be able to buy houses and make investments.

[4:30 p.m.]

The NDP have their eye on it. They won’t tell you this, but they’re getting there. They’re going to go after all of that. They want to slip their hand in to anybody that has an asset, that builds it. They think they shouldn’t have any money because they’ve worked hard, and that’s sad.

[R. Chouhan in the chair.]

I know that some of the members on that side of the House have investments in real estate. I don’t begrudge them a bit, because they worked for it, and they had the fortitude to do it. I don’t begrudge somebody that actually bought a marijuana stock six or eight months ago and is making a lot of money because the stock went up. They made a decision. They made an investment. They took the risk.

If you want to see how this works with the transference of some value and wealth from one generation to the next, you need to go no further than me. I was in the RCMP at 19 years of age. I moved to Brooks, Alberta, when I was 20 years of age. My grandma, Elsie, had died the year before. My grandma, Elsie, was not my paternal grandmother, but she was my grandma, Elsie. She left $12,000 — $6,000 for my dad and my mom, and $1,000 for each one of us six children. I used that $1,000 as a down payment on a single-wide 14-by-70 mobile home in Brooks, Alberta. That’s how I got into the housing market.

I took that $1,000, built up a little bit of equity and bought a lot for $2,000 in Duchess, Alberta. I wasn’t speculating. I actually built the house with my wife, ourselves, in Duchess, Alberta — a four-level split. When I left Brooks, Alberta, I made money on that house. I put it in the bank, because the community I was transferred to didn’t have a place that I could find to buy. The market really didn’t have that much housing in the little tiny community I was sent to.

When I left the RCMP, I bought a little security company that grew from 1½ employees to 300 employees across western Canada. Where did I get the capital to start that little business? It was from the house that I built and built equity into.

I’ve told my children, from the time they were young teenagers, that at the very first opportunity they had, they should buy themselves a little condo or something and have a place to live and build some equity. Put it as a priority — not the new car, not the other things, not the other toys — to start investing in something for the long term. That’s something we should help the next generation to do. You want to approach a housing crisis? Figure out ways you can share equity with them to get them into the marketplace so they can build the equity for the future of their children and grandchildren.

We had a program like that; the minister cancelled it. We had another one coming called share equity which would allow municipalities to put land up. The land would stay in as value, and somebody would be able to buy a condo or a home in that particular development at maybe 25 percent less than marketplace. When they sold, they would give 25 percent of any upside back to the municipality. It works like an annuity, actually.

If you say it can’t be done, you’re wrong, because I wrote this program and developed units like this on 99-year leases in the late 1980s and the early 1990s. It was affordable housing for seniors, who then owned their unit. When they left, in the one, 15 percent of any increase in value went back to the municipality because they’d invested there. The municipality has been paid back three times, and the lease has still got another 70 years to go.

As we look at these things, we have to remember that taxation is, basically, often — and, in this case, most definitely — a taxation on initiative, a taxation on affordability, a taxation on the ability of us as British Columbians to be treated fairly by our government. On top of that, it’s a special deal. They used to call it friends and insiders, but I think it’s the friends of the confidence and supply agreement. Saanich North and the Islands is out. Parksville, incredibly, is out, after “the best retirement home I could ever imagine having” was bought — those are his words, not mine — by the member for Oak Bay–Gordon Head in Parksville.

[4:35 p.m.]

As we go through the discussion of this bill and talk about the amendments…. There should only be one amendment to this bill. It should be the amendment that says to repeal the bill or to not pass it in the first place. All it is, is an attack on British Columbians, who will, by the way, be more of the people that pay tax, in this speculation tax, than any other group of people in Canada — period.

They tried to tell us…. I heard the leader of the Green Party earlier telling us: “Well, we didn’t want British Columbians to have to pay it, so we were going to step up.” This is how they stepped up. It was 1.5 percent for anybody in Alberta, Saskatchewan, Manitoba or Ontario and half a percent for people in British Columbia. Now it’s half a percent for everybody in Alberta, Saskatchewan and Manitoba and half a percent in British Columbia. He did nothing — nothing — for his constituents, for British Columbians — period — in this little deal they made.

What the Green Party did with their little announcement today was throw four-million-plus people in British Columbia under the bus. That’s what they did. And they didn’t get any opt-out clause, which they said they would get. He said they sat down — you’ve got to laugh — and negotiated for hours. This was a lot of work, a blur of work to get to the point where we change the title name and we basically do in every British Columbian in this deal. Why? So that we can have a tax that takes away people’s opportunities and their pension plans.

Some people don’t have defined-benefit pension plans, and they actually invest in things so that when they retire, they have something to fall back on. This is a no-no for the NDP — that you would ever invest in your future, for your retirement for your family or to have assets that you build on for your children and grandchildren. Now, I probably would have sooner or later gotten into the housing market, but my grandma, Elsie, gave me and my wife a gift. She passed it down, as we pass it down to our children, and they pass it down to their children. I know some people on the other side don’t see the logic there.

If you want to say to me that I’m going to have an estate and an inheritance tax, then put it in the bill. Put the definition, put the name on it and say: “I’m taking away the money you’ve worked for, for your family’s future because you happen to have made an investment, and now I want it take it away.”

Can you imagine what would happen next if they decided to tax mutual funds, pension funds — what it would do to the marketplace? The inability of people to finance their future, to be able to do something themselves. It’s just incredible, yet they’re doing it.

They don’t want to admit it. They don’t want to admit that what they’ve already done has already slowed down housing to where our supply is going down. I can tell you what happens when supply goes down and you have people coming into a market. The price goes up. They’ve already done it on residential tenancy stuff. I already know of 350 units that were going to be bought by a group of people to continue to keep in the rental market in British Columbia that will now be slated for demolition, because there’s no way they can tack out the numbers to even figure out how to pay the bills if they can’t get any rental, even 2 percent plus CPI.

I don’t know if you’ve noticed, but municipal property taxes are going up — usually, in my area, 5 to 7 percent every year. That has to be passed on to somebody’s pocket. The ability to replace the boiler, to actually maintain or upgrade — all taken away, the ability to do that. I can guarantee you this. In a few years from now, you will hear…. If the NDP are even around in this House, I will remind them that you guys decided that you were going to do something to kill the future prospects of rental housing in British Columbia

[4:40 p.m.]

I had this conversation, by the way, as the critic for Housing with the now Solicitor General in 1996-97. I told him we’re sitting on a future rental housing crisis because they’re vacating the market. They can’t put money into it. They can’t make an investment for it. As a result, you’re going to see the market collapse as far as new builds of rental housing.

It’s not just in British Columbia; that’s actually all over Canada. The last time, in our entire country, we saw any increase in the building of rental housing was when we had MURB’s back in the ’80s, which allowed for a flow-through on costs and capital gains for the ability of people to make an investment and have a rental in the marketplace. When that program went away, rental supply went down, and there was a reason for it. That rental supply was made because there was an incentive to the marketplace, not a disincentive to the marketplace. That’s a big, big change.

So here we are today. I heard the member for Oak Bay–​Gordon Head say: “No, we’re not giving up. We’ll continue to work on this.” I’m sorry, to the member, today, because it was a sellout. In his own quotes, in his press release today: “While this is still not the approach I would have taken, these amendments will improve the bill and will mitigate many of the key issues I have identified.” Well, his key issue that he identified was an opt-out clause for municipalities. There is nothing in here that gives anybody an opt-out clause.

Then the Finance Minister…. This is where the other sort of give was. “‘While we strongly support the intent of the first two amendments, we are of the view that the third amendment lessens protections against out-of-province speculative investment,’ said James. ‘We believe it is fair to ask those who do not pay income tax in B.C. to pay their fair share. But with a spirit of compromise, we will support the amendment.’”

Basically, the Finance Minister is saying: “Well, we gave in a little bit, so everybody else in Canada can drop down to half a percent. British Columbians will stay at half a percent. And we’re compromising because we’re just going to get less from everybody else, and we’re just going to put it on the backs of British Columbians.”

I get the piece in the press release that says Canadians should be treated equally. I don’t disagree with that. But I think everybody should be treated fairly. So why West Kelowna? Why Kelowna? Why Metro Vancouver? Why not Saanich North and the Islands? Why not Parksville? Why not Juan de Fuca? Is that equality? Is somebody in Abbotsford less of a British Columbian and Canadian than somebody that would be in Quesnel or Prince George or Ashcroft?

This is a gerrymandered deal to get taxes that, ironically, now won’t even help the balance sheet, won’t pay a single bill to a school, a hospital, a road or anything in B.C. I’ll tell you why. They’re going to give it all back to the municipality where the tax is. And that’ll be interesting bookkeeping to watch that little puppy come along.

But as we go through this, we’re also going to find that it won’t work. And we’ll end up with less housing starts, which we have already. We will have less housing being built. And we’ll have a spec tax that is only there for one reason — to follow the philosophy of the NDPers that have told me over the years that they would be able to balance the budget by taxing the inheritance of the next generation, the transfers of wealth. This is step 1 to the inheritance tax piece.

That’s why I won’t support the bill. That’s why the debates in committee will be interesting. But I can tell you this: this is nothing more than an attack on decent, hardworking British Columbians, grandparents, parents and their children, who have made shrewd investments and worked hard in order to have something for the future, for the next generation.

Point of Privilege
(Reservation of Right)

A. Weaver: Hon. Speaker, I rise upon a point of personal privilege for comments made by the member for Langley East, which I will provide you in written form at a later date, for addressing at the next sitting of this House.

Interjections.

[4:45 p.m.]

Deputy Speaker: Member.

Members, the member has the right to stand up and raise the privilege point.

Debate Continued

S. Thomson: I’m very pleased to rise to make comments on Bill 45, the speculation and vacancy tax, and provide what I hope is an important perspective, particularly from an area that is being very, very significantly impacted by the introduction of this tax, the uncertainty that’s being created. But this is not just about our region. This is about the province. This morning we had the great ShakeOut B.C. Now I think what we have is the shakedown of British Columbia, in all parts of British Columbia.

I listened very carefully to some of the comments. Particularly, I listened to the comments of the member for Powell River–Sunshine Coast. It became very, very, very clear in his comments. He said: “Well, maybe we should give it another name.” He said very clearly that the goal of all this is to have an impact on housing values. It’s not to deal with speculation. It’s to have an impact on housing values. He was saying maybe this should have a different name.

The member for Langley East talked about what he would call this tax. I wrote down, even before the member commented, that I think the legislation could be named something like the “Taking away people’s hard-earned equity, their retirement dreams, their dreams for their kids” act. Because this is really what it does. It’s a tax on assets. It’s a tax on wealth. It’s not a speculation tax.

It’s very clear in the comments from the member for Powell River–Sunshine Coast that the goal was not to address speculation. It was to impact housing values. If that was the intent, they’re achieving that intent, because we’ve seen the impacts in our communities.

Today in Kelowna, in West Kelowna, in Langford, we have very, very, extremely disappointed mayors, disappointed leaders in those communities. I’ve talked to the mayors in the Okanagan, and they really feel like they have been led down the garden path on this, that they had expectations that the amendments would be made that would provide for the opt out of communities so that they could manage those issues in their own communities.

What they saw today is, as I said, very, very disappointing to them, extremely disappointing to them. They, as they continue to look at this, are going to continue to see that disappointment.

We’re going to start to hear — and I’ve already had many emails into my offices — we’re going to start to see the great, extreme disappointment, not just of the leaders in our communities but of many, many of our constituents, all who have communicated to us previously around the impact of this on their situations, on their hard-earned equity, on their retirement plans, on their efforts to build a future for their kids, to be able to pass something on to their kids in terms of the next generation.

[4:50 p.m.]

When they realize today that the communication they received from the leader of the Green Party, that he would take all his efforts to ensure that the impact of the tax on those situations would not take place, that he opposed the tax and he opposed the nature of it, the way it was being implemented and applied…. They are, as well, going to be extremely, extremely disappointed in what has come forward with the tabling of the tax, tabling of the legislation and the proposed amendments to that legislation that have been worked out in that supposed negotiation around the confidence and supply agreement. Again, as this information gets out, it’ll just be extremely, extremely disappointing.

I had a comment today, just to show you the direct impact and collateral impact of all this. This comes from Stew Young, the mayor of Langford, which is the largest city in the Premier’s riding. Here’s what he says today: “This is a job-killer and just another cost to the hard-working families, forced on a majority of municipalities that don’t want it, while others who aren’t in the so-called spec tax region, are spared this damaging spec tax. I will never support a tax on Langford taxpayers, homeowners, that hurts jobs, lowers house values on hard-working families, nor will I support a harmful tax that hurts our open door policy on all Canadians investing in our resort area at Bear Mountain and other parts of Langford.”

As an additional note, Mayor Stew Young advises us today that he just got word that Bear Mountain has cancelled the PGA tournament there because of the spec tax. The impact of the spec tax just makes the numbers not work. Again, you see the situation where it has impact on individuals, and it has impact on initiatives — a very, very significant tournament that brings people, tourism dollars, into our community being cancelled because of the impact of this spec tax.

I also want to talk about it from an individual, personal, level as well, from how this affects individuals. I’ll use this example. I’m going to call the couple Mr. and Mrs. Smith and outline their situation.

The members opposite talked about some of the exemptions that have been brought in to deal with some of the particular situations and things like that, and a range of exemptions. In many cases, those exemptions will deal with some of those situations, but they’re also going to create a complex set of processes and administrative burden in terms of trying to work through all those and to see whether you fit into them.

Here’s the couple here. They’re a couple. “My wife and I are lifelong B.C. citizens, lifelong B.C. and Canadian taxpayers. We are now both 72 years old and retired.” They have a place in Kelowna, and they have a condo in West Vancouver. “We will never rent out our small West Vancouver condo for a second residence where we plan to retire and move into full-time as we age and which we occupy now for about 100 days or more each year. We have no formal pension and have set ourselves out to live out our days in the West Vancouver condo using the proceeds of the future sale of our Kelowna townhouse to help support our last years. We are not quite ready yet to sell our Kelowna residence, as we have grandchildren living in this community.”

So here is a tax, a so-called speculation tax, that is affecting the plans and the dreams and the retirement plan for this couple. I looked through all of the exemptions, and the exemptions don’t apply, in any cases, to that situation. This is just one of many, many, many examples we have in our constituency and we’ve heard.

[4:55 p.m.]

All of this has been provided to the Minister of Finance. She knows these situations. They’ve been provided to the Leader of the Third Party. He knows those situations and, in communication to them as these were coming forward, indicated to them very clearly that he did not support the tax being applied to those kinds of situations.

What do we see today? Despite those assurances, despite all the indications both to individuals and to leaders in our communities that he would oppose this tax and provide the opportunity for municipalities to opt out, what do we see today? We see an agreement that gives mayors an annual meeting with the Minister of Finance. Great. That’s not going to achieve a whole lot.

We see the continued application of the so-called speculation tax to individuals in British Columbia. The information has come out clearly through great work by our co-critics in the Ministry of Finance estimates that the greatest majority of that is going to be paid by B.C. residents. No change for them. No standing up for those B.C. residents and families — their dreams, their hopes and their aspirations. Some adjustments to the other provinces or for people from other provinces, but nothing for the people of British Columbia.

I wonder, with all of these situations and these individuals…. I’ve got another example. Again, I’ll call them Mr. and Mrs. Smith.

“We initially started a vacation in the Kelowna area in 1974 using camping facilities in the West Kelowna and Westbank area. In about 1976, we brought our family to vacation for two weeks in the summer — Boucherie Road resort in Westbank. Annual activity was often supplemented with visits around the May long weekend.

“These continued annually, without exception, from 1974 onwards. We eventually purchased undeveloped property in the Westbank area with the intent of building our retirement home in that location.

“This purchase occurred in the mid-’80s. We subsequently decided that we would not build a home but purchase a condo in downtown Kelowna. In 2001, we took possession, selling our property to help fund the purchase of the condo.

“We have now occupied this condo for almost 15 years. We will continue on indefinitely, as the home will be passed on to our children and our grandchildren.

“During the period, we and our extended family and occasional friends have used the premises every year without exception. Our occupancy is averaging two and half months per year. We intend to spend more time in our home as we move farther into our retirement years, but we will not meet the six-month minimum.”

They list over $130,000 in fees, property taxes, insurance, strata fees. They’ve done extensive renovations. They’ve invested in our community. They put in their comments here:

“We further believe the intent of this legislation was never to destroy the dreams of fellow Canadians who have done nothing but love and support B.C. for the majority of their lives. Our annual tax for us will be around $15,000.

“We’re seniors, 69- and 71-years-old, on fixed incomes. We do not have access to the resources that will allow us to fund this additional expense, and this will impact our retirement plans and impact the future opportunities for our children.

“Both my wife and I have worked hard all our lives and have carefully budgeted to have a vacation home in Kelowna. We had hoped to pass on this wonderful opportunity to our offspring so that they could enjoy the activities we have enjoyed for a significant period of time.”

When I say this tax is not a speculation tax but it’s a tax…. Or it could be more appropriately named: “Taking away people’s hard-earned equity, taking away their hopes and their aspirations and their dreams.” It’s a tax on asset, and it’s a tax on wealth. It’s not dealing with the speculative nature that it was — what it was named.

The member for Powell River–Sunshine Coast talked about how many people support this. He quoted some polling results that show how strongly people support this.

[5:00 p.m.]

Well, I wonder if they actually knew what this tax does, what the intent of it was and how it is being implemented, whether we would have those same numbers.

If you asked anybody, “Should we be dealing with speculative impacts in the market? Do you think that’s a good idea? We’ve got this speculation tax that is going to do that,” I think the greatest majority of people would say we should, and we agree.

This does not do it. We put in a private member’s bill that would’ve done that. This has gone to a completely different approach, because it is an ideological tax grab that is, as the member for Langley East said, dipping into people’s pockets and taxing their assets and taxing their wealth and their future dreams.

We’ve seen, in our community, projects cancelled. We’ve seen the impacts. I had a young tradesperson in my office. He runs a painting company, does renovations and upkeep on homes in the community for people generally outside our community who are there for part of the time and spend significant amounts of time and dollars in our community — a young guy who mortgaged his house to build up his business, six to eight employees. When this tax came in, he lost four significant contracts to continue to do that maintenance work. He had to lay off people in his company and downsize it.

The people, because all of the uncertainty that was created, stepped back and said: “We are not going to continue to make these investments. We’re not going to do the upgrades on these homes, because first of all, we don’t know where this is all going. Secondly, we don’t feel like we’re wanted in your community anymore, that you’re targeting the investment from outside the province in our region and that you don’t care.” They really felt insulted, felt discriminated against in this process.

So projects sidelined. We’re seeing major projects being cancelled. The member for Kelowna West and others have talked about those projects. I don’t need to go through them again. Housing starts down 60 percent.

It’s not just us on this side of the House ringing the alarm bells in all of this. We’ve gone through the examples of municipal leaders who were impacted, who feel strongly that this is ill-conceived, ill-informed, done without consultation.

I know the Minister of Finance, the member for Victoria–​Beacon Hill, will say that meetings did take place, consultation occurred afterwards on this. She will be able to say she listened, but she didn’t heed all of the concerns that were coming forward. This is ideologically driven, flawed legislation that is not meeting any of the intent that it was set out to do, other than to disrupt the housing market and reduce housing values, just as the member for Powell River–Sunshine Coast said was the intent.

It was done initially without any modelling, any impact analysis on what this would do. We’ve now seen lurch to lurch to lurch in it, with introduction on the budget side of it, then some changes, pullback changes to the area. Now we’ve seen the agreement around further changes. That’s going to reduce revenue from this tax, as pointed out by the member for Prince George–Valemount. It’s going to leave a very, very significant hole in the fiscal plan for the province.

[5:05 p.m.]

I wonder how they’re going to make that up, other than the provision that they’ve left in the bill which says that by OIC, we can expand the area of the application of this tax to include other areas. While it may be limited to the areas that we see now that are specified, the provision is there to extend it further, and that is having impacts in all of those other areas as well.

It’s creating an unlevel playing field between communities. I look across the lake, on the west side of Kelowna, on the west side of the lake, where there was an arbitrary application of a boundary. If you happen to have a home on one side of that, you’re impacted. These are generally vacation homes that are out down along the lake. They’re not the homes that go into the rental market. While we’ve invested significantly in Westside Road improvements — there have been significant investments — this is not dealing with that rationale they’ve utilized for bringing this in.

If you happen to be 100 yards farther down the road, you’re not in. You have an advantage if you’re thinking about selling the property. If you can have some assurances that perhaps you can take the risk that the boundaries may not be extended out, then you have an advantage over a person 100 yards from you in the same market who has had to pay the tax, who has to account for all of that. Most of those homes down there are exactly in that category of longtime investments. People have invested in those with their hard-earned dollars and their future investment in the Okanagan.

There’s been no rationale provided as to why that stands up to real economic analysis, as to why these communities were included and why others weren’t. Comments were made: “Why Kelowna, West Kelowna?” Then you’ve got Squamish, Whistler and other areas that aren’t. There’s no rationale. Then you see the supposed rationale around taking out some of the initial specified areas. The member for Langley East laid out very clearly what the most likely rationale for all of that decision was.

Now we see a half-baked process, legislation that doesn’t meet the intent of what it was set out to do, other than reducing people’s values, other than impacting future dreams and aspirations. It has been introduced at one level — some changes, now some further changes. This is just an example of not how you do good public policy, and it really seems to fit a pattern that we’re seeing here.

We have an education tax that really isn’t an education tax. We have an employers health tax that, pure and simple, is a replacement tax for MSP, putting those costs onto businesses, local governments. Those costs are going to have to be passed on in the market. They’re going to have to be passed on in the tax base within local governments. Again, that’s going to affect affordability, affect development.

Everything they’re doing here is working in a counter way to addressing the real challenge of what was stated from the beginning — that this was to address speculation. It is clearly not that. It fails to directly target speculation. In fact, the legislation, as drafted, actually enables and allows speculation to continue, because section 49 of the bill provides for an exemption from the tax for that first year on new homes.

[5:10 p.m.]

You’re going to see that loophole or that provision where, if people want to continue to speculate in the market, they’re going to be able to do that without having the impact of this speculation tax. It really is something that we…. We, as the members on this side of the House, will not be supporting the legislation. We will be looking to bring further amendments in the committee stage on this, because this really is something that needs to be taken back to the drawing board, changed — and to look to a process that directly targets speculation and doesn’t impact hard-working British Columbians. As was pointed out, over two-thirds of the impact is on British Columbians, with example after example of good, hard-working people from British Columbia that are going to be impacted by this.

The member for Oak Bay–Gordon Head talked about the fact that he didn’t want to see regular people being hurt. Well, regular people are being hurt by this tax. I guess that his answer to those is, “Sorry, I had to make a deal in order to keep my place down here, at that end of the benches there,” and to say: “Sorry, we know you’re regular hard-working people, but you’re just going to be collateral damage in the process, because we made a deal, an arrangement, to support the continued application of this tax.” It’s going to impact those kinds of hard-working British Columbians that he said he didn’t want to see being hurt in the process.

Well, they are. Disappointingly, extremely disappointingly, that is going to be the impact. If the members from the Third Party, the members opposite, continue to support the amendments they intend on bringing in and vote for the overall bill, then we will have this tax in place that has those impacts — that collateral damage in our communities and in our economies. That is very, very disappointing.

I’m pleased to stand and provide my comments to indicate that I’m not supporting this bill — not just because it applies to my riding in Kelowna-Mission and in the Central Okanagan, but because it has those impacts all across the province. It isn’t fair. It is just a misnamed process. It is a tax on our assets, a tax on hard-working British Columbians and should not be supported.

I look forward to the committee stage and amendments that will be addressed during that stage.

S. Chandra Herbert: Well, I rise today with great pride to support this legislation. I say that I’m excited to support it because it’s been a long time coming, and finally, finally, we are having a government that is starting to act on housing affordability — starting to act in a serious way to make housing more affordable for British Columbians in each and every community.

Now, the speculation and vacancy tax — well, what is it? Well, it targets empty homes. It targets foreign speculators while raising hundreds of millions of dollars to put towards affordable housing. It ensures that those who, in many cases, own $1 million homes or $5 million homes but declare poverty-level incomes…. We can ensure that they’re actually paying their fair share of taxes.

British Columbians want action on affordability. They want action on fairness. They want to know that the system is not being gamed to benefit somebody who has figured out how to speculate and trick the tax code to get rich.

[5:15 p.m.]

You’d think that this kind of legislation would be universally supported and would be something that would have already been done by now, because it ticks so many boxes that British Columbians have asked for. Apparently, it’s not universally supported. But I know that in my community, there’s a reason why 77 percent of the public opposed the B.C. Liberals in the most recent election. It’s because they seem to be, based on the debate I’ve heard so far, focused solely on those who own multi-million-dollar homes, multi-million-dollar retirement homes, and nobody else. It’s only about folks in those situations.

Yet you’ve got over 8,000 people homeless in this province. The number has gone up each and every year while they were government. You’ve got people who’ve become farther and farther away from being able to afford a home in this province, which got worse each and every year the B.C. Liberals were government. And then there was nothing done. And now, when we are moving to bring forward a speculation and vacancy tax, we hear nothing but opposition.

The reason I’ve heard, the one reason that seems to be coming through, is because a few wealthy people will have to pay a little bit more. Well, the wealthy people that I’ve talked to in my community in Coal Harbour, a neighbourhood which could be impacted by this speculation tax, by and large have told me they support it, because they want empty homes to be lived in.

They don’t want their neighbourhood to have the misnomer of Cold Harbour because you can’t find anybody living there. They want it to be a warm neighbourhood where you have buildings actually occupied, not 75 percent empty, 55 percent empty, 25 percent empty. Each building is a little different. They want neighbours. They want to see that if you’re benefiting from an incredible community, you’re actually putting some money back into it.

How did we get here? How did we get to this crisis of affordability? It’s been many years in building. I think we could go all the way back to Expo and a decision that was made a long time ago to make foreign real estate and the purchase of foreign real estate a major export, in a sense. But really, it jacked up in the last ten years under the B.C. Liberal government and low interest rates.

We saw a determined effort to juice the real estate market, to get more and more people fighting over real estate, and active participation from the government of the time to go overseas and try and get more people to come over here to buy our real estate so they could hold it as an investment to speculate on. Meanwhile, the costs shot far above any locals’ ability to buy.

You look at the average home in Vancouver. What kind of salary would you need? Well, the average person would probably need 25 percent more than what they’ve got now. Sorry — 25 times, not 25 percent. That would be nice. That might be possible. But 25 times, 15 times, even ten times more than what their salary would allow is still too far of a gap to get there.

What was the government’s answer of the day? Rather than what we’re trying to do with the speculation tax and the vacancy tax — make those empty homes livable, get people to invest in their communities and live there — the B.C. Liberals’ response had been, and their Premier said: “Well, just move out of the city. Move to the far northeast. Leave your home community.”

That was the B.C. Liberals’ response to this housing affordability crisis, and it hasn’t changed. It continues to seem to be the watchword of do nothing, protect the absolute elite, the most wealthy, and for everybody else: “Too bad. You should just get a job and leave town.”

My constituents are upset about that kind of behaviour and that kind of attitude. They believe that they are working hard, they’re investing in their community, they’re paying their taxes and that the government should be working for them, not for those who just look to park their money here to flip to make a quick buck. We now have a government that is listening to my constituents’ concerns, and thus we have legislation like this.

I think about a constituent of mine, a woman named Anne Gregory. I met her years ago. She’s in her late 90s now. She helped in the war against Hitler and helped against Stalin as well. She remembers seeing Adolf Hitler across from her as she was a young woman and how at the time he was selling all sorts of things to people, trying to make them believe that everything was possible if they only targeted minorities, if they only put away their consciences.

That never sat right with her. She always thought that you should work hard, care for your neighbourhood and care for your community. She grew up in Austria, in Vienna, where they’ve invested a huge amount of money in public housing, and it’s worked very well. She sees what can happen when a government actually works to build a community that can support community, not just the very wealthy.

She would always say to me: “Spencer, what are you doing about the speculators?” She dared me to impersonate her at one point.

[5:20 p.m.]

She would just say that to me again and again, because she knew the corrosive impact that allowing those with the most money to buy up all of the housing can have on a community. She knew, and she saw it through her life, growing up around the world, how that can make a community no longer a community but just a resort for those with the most. She didn’t want that for her neighbourhood of the West End. She didn’t want that for Vancouver or for B.C. She wanted everyone else to have that same opportunity she had to be able to enjoy a neighbourhood, live a long time there, make friends and make neighbours and not just be about who had the most money in their bank account.

I just think of her voice and what she had done, over many years, to build a great community and why it’s incumbent upon us to be looking at that same kind of building to allow others to live in our communities down the road.

It’s not just folks like Anne Gregory. I think about my Coal Harbour constituents. I think about the business folks that I’ve talked to who’ve said: “We can’t get employees anymore. We know we’ve got a booming economy. We’ve got more jobs than almost anywhere else in Canada right now. We’re prosperous as a province, yet people cannot find housing.” It really makes them mad.

I hear that from business owners. I hear that from people who are looking at condominiums and from others that have empty units. Now, that’s another issue that the Rental Housing Task Force has heard about: the whole question of vacancy and whether or not folks should be allowed to leave homes empty for year after year because they don’t want renters living in them. I think that’s a challenge. Well, I think we need to address that through a couple of means, but we’ll come to that later.

I think about who, in my community, actually opposed the idea of this legislation. There were probably about two or three who initially came to me. This rolled out early so that people would have a sense, so that there could be consultation, so that there could be a back-and-forth, so that we could get to a better tax.

One of the persons, who I’ll have to agree to disagree with, was quite upset with me. I think it’s important that I recognize that this is not universally popular. This woman, who’s dead set against the tax, complained to me. I said: “So what’s the issue? How does this impact you?” Well, she owns a two-bedroom condominium in Kitsilano, and she owns a two-bedroom condominium in Coal Harbour.

For those who don’t know Vancouver, Coal Harbour and Kitsilano are very, very close together. One is across a small bridge, the Burrard Bridge; the other is right downtown. You can walk between the two in — I don’t know; I walk fast — maybe 20 minutes to half an hour or something like that. That’s walking. Driving, depending on a good day, it could take you five minutes, ten minutes or maybe longer if there’s congestion.

She was upset that she shouldn’t be allowed to leave one home empty just on the “rare occasion,” as she put it, that she worked a little late and wanted to be able to stay at her Coal Harbour condo instead of her Kitsilano condo. Then she proceeded to complain to me about homelessness. Why didn’t somebody do something about homelessness?

It just jarred me to think that somebody who owns two multi-million-dollar condominiums would be upset at paying a 0.5 percent tax in order for her to continue to enjoy this benefit — meanwhile leaving people on the street because of a lack of money to invest in getting people off the street and the health care that they need.

I told her I had to disagree with her. I thought, given that she had a lot of money and that she’s making a lot of money…. She can continue to live there and live as she sees fit, but I wanted her to understand that I thought she needed to be part of the solution. She didn’t completely agree, but she did admit that, yes, maybe she should be doing a little bit more to help make our community better.

Now, I know my friends — I talk to many people around the question of supply — in the development community…. They said, based on the original version of the speculation tax, that they had some concerns. Now I’m receiving emails from developers — of rental housing, of condos and what have you — who are saying: “Okay, you fixed that. The speculation tax doesn’t apply to development sites or properties under development. Good work. You’ve recognized that supply is needed.”

I know my friends in the Green Party had some other issues, and they’ve worked to get those issues through as well. I know there’s always more to do. Laws are never perfect. There’s always room for growth and room for change in the years ahead. This gets, I think, fundamentally, the right balance. It makes sure to exempt 99 percent of British Columbians, and the only folks that it captures have options. They could rent out their empty homes.

Now, there are a few cases where they may need exemptions. Principal residence. If you live there, it’s your principal residence. It doesn’t apply. Medical absence. If you have to leave your home and leave it empty for medical absences, that doesn’t apply. The principal residence of a person with a disability. You can find a way through that, under one or two of the programs. Spousal separate residence, work, medical reasons, additional one-time principal resident exemption, spousal separation exemption, bankruptcy exemption, exemption upon death, questions around rental exemptions, and so on.

[5:25 p.m.]

The minister actually went out and did consultation, listened to many, many different voices and has brought forward a much-improved version of this tax so that people who it was not designed to impact aren’t impacted by it.

There may be more to do, and I certainly will continue to work with my constituents on any issues that they may see come up, as I always do. I think that just because it’s New Democrat legislation or a New Democrat government doesn’t mean we are 100 percent infallible. I always say to my constituents that no party has a monopoly on good ideas or a monopoly on making mistakes. It’s incumbent upon us, as legislators, to do our work to make sure that legislation works and, if it doesn’t, to fix it.

I think about this. I think about the need to act. Why? Well, I’ve got here Sylvia, a young mom, a tech entrepreneur. She writes:

“…pleading and begging of you to address and take meaningful action on the housing and affordability problem. I’ve seen this city become extremely unaffordable very quickly over the past ten years, and it is drowning my family and many others who live here.

“We’re a young family with a nine-month-old, and both of us are working professionals in the IT industry. Even though we make a good income, we’re finding we can’t afford to live here. Renting is becoming increasingly expensive. In order to buy a property, with a dog and a baby…. It’s almost impossible to find.

“Please keep working to make housing more affordable. Please support a speculation tax.”

Patrick: “The past ten years — very stressful, worrisome times. Feeling like I could lose my home at any time is a terrible way to live. Many of us are quite literally one paycheque away from desperation. What you’ve done for this province has greatly reduced worry and fear. Please continue.”

Alexandra. Now, this is somebody who has been critical of me in the past. “After a few harsh emails” — yeah, I remember them — “I sent prior to the last budget, I have to thank you for the action on the housing file. Thank you for bringing back hope that there’s still hope for people like me in this province. Do not back off on the speculation tax under the pressure of the wealthy,” she says.

We as a province and as legislators have to work for everybody. We have to consider the impacts of our decisions. Who benefits? Who loses out? Where can you find a middle? Where can you try and build community together, where we all are in the same ship, rowing in the same direction, as a colleague likes to say? I think the speculation and vacancy tax does that. We need money to invest in affordable housing, because we know the previous government didn’t go far enough to address these challenges. We know that businesses and communities need that action now.

Tying the speculation tax so that that money is actually reinvested in the communities where it comes from is a good thing. I know that in my neighbourhood, in my community, that means we’re going to have more funds to invest in affordable housing for people in the middle income, for low-income people, for the homeless so that we can start getting a handle on a crisis that was left to grow over 16 years. Now we’re grappling with the dire consequences of it.

I don’t want to go on too long. I know my colleague from the Green Party is also going to share his remarks on this.

Clearly, there’s more to do. We know that flipping is still a challenge in this province — flipping to gain money and go forward that way. We know that my colleagues the Finance Minister and the Attorney General are working on the issue of — whether it be blind trusts, ways to hide money, foreign numbered companies, gambling — the corrosive influence of money laundering in the real estate sector as well as in the casino sector.

We know that, for example, on the buildout of things like student housing, something the former government basically banned on university campuses, we’ve cleared that path. That’s thousands upon thousands of new units coming to communities all across B.C. — just on student housing alone. It was incredible to see how quickly universities and colleges have acted on this. They saw the demand.

The former government said: “No, there’s a demand there, but we’re not going to touch it. If you have a problem, move out of the city.” We said: “No, we’ve got to act, and there are ways that we can make this better.” We believe it’s incumbent upon a government to do this, not to just, as my colleagues on the other side argue, stay back.

To give credit, one of my colleagues opposite did say that the speculation tax, he felt, could moderate, could lower real estate prices, which could make it more affordable for people.

[L. Reid in the chair.]

However, another colleague on the opposite side, on the Liberal side, seemed to speak in opposition to the very idea that we might want to make housing prices more affordable rather than this insane buildup that we’ve had, which has made them out of reach for most, except for the very few or those who might have foreign capital looking to park in this province.

[5:30 p.m.]

There’s more to be done. It’s been an honour to serve as the rental task force chair with colleagues from the two parties, anyway, who seem to have an interest in supporting renters, because speculation and vacancy are also impacting renters.

If you can’t find a home because it’s sitting empty, because some foreign capitalist has plunked their money in it and wants to just use it to gain a profit as the price goes up and up and up, that’s an impact on you and your life. Now, you’re a renter. You’re not trying to buy, but if you can’t rent that unit because somebody has taken it out of the rental pool just to turn it into income, that’s a problem, because that person is not doing what they need to do to support our community.

I think the Leader of the Third Party talked about it as an externality. That’s a cost you’ve pushed onto the community through your own desire to get rich off of an empty condo. I agree. It is an externality, and it’s a problem.

Business owners in my community have spoken about that as well, and how in Coal Harbour a number of the businesses were built predicated on a certain number of people living in the community. But when they found that 50 percent of buildings were vacant, in some cases — 75 percent, 25 percent in others — they couldn’t make those businesses run.

It’s not just the business. It’s the community centre. It’s the neighbourhood. It’s the streets. People want communities for people who live there. They don’t want their neighbourhood to be for the jet-setting elite who can drop in for a day, maybe a week, jet off and then not be there for the rest of the year. They want a community for their community, and I think this bill will help us get there.

For that jet-setting elite who want to drop in and spend a week or have two homes and jump back and forth between them, it’s a small tax. It’s not a lot. Sure, it does cost, and I know for some it will certainly cause them to consider options. But let’s look at it in the context of how much wealth many people have gained through just sitting on a real estate asset.

It used to be, in this province, that you were expected to make your wealth, make your money, through hard work — through working hard, setting savings aside, and so on. The number of people I’ve met these days who believe the only way to get rich in this province, to get wealthy, is just through buying real estate and flipping it — driving up costs, speculating on it, driving up further costs, putting housing further out of reach of others — has become too many.

I think working hard should be how you get money and how you make a good life for yourself, not just being able to sit on an empty condo as it generates massive profits through you doing nothing. That’s not, to me, what the moral should be that we teach our children. It should be about looking out for your community, not through the luck of a draw, through gambling on casino prices to drive yourself rich while driving other people out of a community.

I’m glad that the Finance Minister has worked so hard to listen to people’s advice on this tax and continues to be very open for suggestions, questions and otherwise. I know I’m glad that my colleagues in the Green Party will be supporting this bill. I think it’s important.

I get that we don’t always get everything that we want in any piece of legislation. I know myself — I’ve been in the same boat many times. But you work to get the greatest good that you can with what you’ve got, as opposed to throwing your hands up and saying, “Oh well, we can’t do anything. Leave the province, or just move out to another community, because really affordable housing isn’t our business,” which seemed to be the message of the former government.

I’m glad we’re not there today. I’m glad we have a government that cares about affordability, that cares about ensuring that we address this housing crisis, because it’s well past time.

A. Olsen: I rise to take my place in the debate on the speculation and vacancy tax tabled by this government. This has been and continues to be a contentious tax. It divides people. It has polarized and driven wedges.

We often talk about the housing situation, the devastating housing situation this government has inherited. But actually, in addition to this crisis, one of the biggest problems that we have inherited is the narrative. It’s a narrative about division and winners and losers, a narrative that has a tendency to pit different classifications of people against one another. Homeowners and renters. The stratified upper and middle and lower class. Boomers, Gen Xers, millennials. Hard-working earners and lazy people, apparently.

[5:35 p.m.]

Although they haven’t been mentioned in this debate — they’ve been left out — if there are hard-working earners, then there must be the lazy people, or people that have just been born in the wrong generation, perhaps. British Columbians and people from elsewhere — elsewhere in Canada and elsewhere in the world. People who may be able to afford a second home after working hard all their lives, who now feel they’re being wrongly treated as speculators. People who work hard and live and pay taxes in British Columbia. People who are working hard just to get by.

A vast majority of British Columbians work very hard, and we should acknowledge them. We should thank them for their contribution to our province. There’s people who are having trouble finding anywhere affordable to live, for themselves and their families, near to where they work. This is a problem that we find on the Saanich Peninsula, a workforce housing issue.

I think we need to do as much as we can to resist this type of division as we work to find a solution for the housing crisis that continues to grip much of British Columbia, all of British Columbia. This type of language elevates and isolates personal interests, treating them as if they’re separate from the needs and the interests of the communities that we represent.

The quality of our communities, the strength of our communities is based on the security of us as individuals. A person’s home is at the centre of our ability to feel secure in our community. Communities have become unaffordable, particularly for young people and for young families. They, too, are people who work hard, and they’re struggling to find a secure place to live. Those are just people that apparently were born in the wrong generation.

When we talk about the effects of the housing crisis and the effects of taxes like this one, we are really talking about the effects on our friends, our neighbours, our family members — people we love, people we care deeply about. That’s what has been so difficult for me about this entire debate. Unfortunately, the kind of dialogue that I’ve too often seen in this debate doesn’t help the nuanced and sober conversation that is needed about finding the right path forward.

I recognize that people are going to be impacted by this tax. I’ve been answering the emails. I understand, and I have heard the stories. I am not going to stand in this place and skirt around that. I am going to look directly at the issues that are going to impact the people in my riding and in communities across the province.

I think it’s important to point out the impacts of not doing anything, as I have pointed out — the very real impacts that are happening to our people today because of inaction. There are impacts there, as well, that are easily ignored, easily forgotten, easily painted over.

Some of these impacts will be mitigated by the exemptions written into this legislation because of the work of our caucus and the government, and others still by amendments that we’ll be introducing in the next stage of the debate, which I’ll touch on later. Even despite these changes, people will still face impacts, and people are still being impacted by the situation as it stands right now in deeply, deeply troubling ways.

I know that in particular, there are many people choosing to retire on the Saanich Peninsula. These people have bought a home there. They’re staying part-time and planning to move here full-time later on. They will be faced with paying this tax unless they are willing and able to rent their homes for at least half the year.

I also have to recognize that I have a responsibility for the entire community, and not supporting housing action like this also has those real impacts. They have the impacts on the people that are struggling really badly right now to find a home — to find a home for their children, to find a home close to where they work.

As legislators, we have a responsibility for advocating for the whole communities that we represent and for debating and passing laws according to how they affect British Columbians in our ridings, at home and right across the province. We must always seek to find a balance.

[5:40 p.m.]

My riding is impacted by this proposed legislation in many different ways. When this legislation was originally proposed back in February, it was going to impact my entire riding, including the southern Gulf Islands. I heard a lot of concern from Gulf Islanders about the impact this tax would have on their local economy, so I was happy when the government announced this spring that the tax would no longer apply to the Gulf Islands or other areas with similar challenges, like Parksville-Qualicum or Cultus Lake.

There’s no doubt that we are facing a housing crisis on the southern Gulf Islands. It is one of the issues that keeps me up at night. It is one of the issues, one of the reasons why I’ve gotten to know the Minister of Municipal Affairs and Housing so well, as we talk about the challenges on the southern Gulf Islands.

I believe that on balance, a tax like this doesn’t make sense for the areas such as the Gulf Islands, especially considering the fact they’ve got the complicating factor of the Islands Trust Act. We continue to have serious housing challenges on the Gulf Islands that need to be addressed, and I’m committed to working with the Minister of Municipal Affairs and Housing on that.

The diversity of concerns in my riding shows how we need to have a nuanced approach to the housing crisis. We cannot have a divisive debate, a divided debate on this. Over the past number of months, we’ve worked hard as a caucus to find a path forward that reduces the impacts of the tax that we feel are most problematic while maintaining elements we think are critical to dealing with the housing crisis that everybody in the last election….

It didn’t matter what door I knocked on in my riding; the number one issue was the housing crisis. Whether it was up on the mountains or in the valleys in my riding, every single person where I knocked on…. Okay, maybe there were a few that weren’t. A vast majority of the doors that I knocked on, when I opened it up, housing was the number one issue they wanted me to address, and it has been the main issue that we have addressed over the months since that election. Some of these are most problematic, such as providing provisions for satellite families and foreign owners.

[Mr. Speaker in the chair.]

My colleague from Oak Bay–Gordon Head has done a considerable amount of work on this over the past many months, raising concerns and personal stories that have been coming into our offices directly with the government. I am pleased with the level of commitment that we’ve seen from government to find solutions on these issues.

We’ve been raising three key concerns in particular over the past number of months. The first is the need for local government to have a more significant role in determining what happens in their community. I’ve always been an advocate for that around the council table and now as an MLA. The second is the fact that Canadians should not be paying higher rates than British Columbians. The third is the need to limit the unfair impacts on Canadian homeowners who are not speculators.

In many cases, this government has listened and has made commonsense changes in the legislation that will ensure that people will not face significant hardships in this tax if they need to own a second home for a variety of reasons. This legislation, for example, ensures that people who own a second home because they need to be in a city for medical treatment, couples who own two homes because they work in different places or an individual who leaves their home vacant because they need to receive medical or residential care will not be paying this tax.

The legislation also has commonsense provisions that ensure, for example, that developers do not need to pay on vacant land through the development process. We need to be incentivizing supply and not disincentivizing it through taxes that accumulate year after year as they go through, in some cases, the processes that take way too long. If a homeowner has a secondary suite that they rent out, they can continue to use their home whenever they choose to without needing to worry about the tax.

We’ll be going through this bill in more detail at committee stage to ensure we have a full understanding of the details and the exemptions available and how different people will be impacted in their different situations. But we didn’t feel that the legislation, as it was initially drafted, went far enough to deal with the concerns we’ve been hearing, so we’ve been working hard with the government over the past few days.

Earlier today we announced an agreement that further deals with some of our key issues on this tax. At the next stage of debate, we’ll be introducing three amendments to this legislation.

First, we’ll be requiring an annual meeting between the mayors of the affected regions and the Finance Minister to go through the impacts of the tax on their communities and have a discussion with the minister about what path forward makes sense for them.

[5:45 p.m.]

This annual review of the tax with mayors will give communities a clear channel for making a case based on evidence for how the tax should apply to their community and whether they should be excluded. It also allows for communities that experience change in affordability metrics to have a clear avenue to bring those to the minister’s attention.

Second, we’ll be ensuring that all revenues from the tax will go back to the housing initiatives within the regions they came from. This is critical to ensure that the communities are seeing the benefits of this tax, that it’s not simply going into provincial revenues. This tax cannot be about revenues for the provincial government. It must always be about remedying the crises in our communities.

Third, we’ll be introducing an amendment that equalizes rates for Canadians and British Columbians, bringing the rate down for Canadians to 0.5 percent. We have heard from many, many people who say they feel saddened and discriminated against by the idea that they should pay a higher rate than British Columbians just because they are from a different province. I think it’s an important amendment that ensures we’re not treating fellow Canadians differently by making them pay a higher rate than British Columbians. I think this is how government should work.

We are able to compromise and find a path forward that limits the impacts of this tax on Canadians who are not speculating, while ensuring that we are still taking meaningful action on the housing crisis that exists — the housing crisis that people in my riding, no matter where they were, agreed and encouraged me to take action on, should I have the honour of representing them in this place.

It’s an honour that’s not easy, I’ll say, an honour that has many, many challenges to it. All our members here know the challenges of representing 50,000 different opinions in this place with a single vote. It’s an issue, and it’s a challenge that I take seriously. Both of our parties, the governing party and the Third Party, agree that taking meaningful action on housing affordability is what British Columbians expect of us. I think our agreement on these amendments finds an appropriate balance.

I campaigned for many months leading up to the 2017 election. I heard from people in every part of my riding that this needs to be addressed, and that’s what we’re doing. Over the months ahead, I’ll monitor the impacts of this tax closely, and I’ll continue to seek out and be led by the experiences of my constituents and the communities that I represent.

J. Thornthwaite: Noting the hour, I will reserve my right to speak again when the House sits.

J. Thornthwaite moved adjournment of debate.

Motion approved.

Hon. R. Fleming moved adjournment of the House.

Motion approved.

Mr. Speaker: This House stands adjourned until Monday, October 22, at 10 a.m.

The House adjourned at 5:48 p.m.