Whereas many municipalities in BC are facing a very significant and well-documented housing affordability issue with property prices significantly higher than local residents ability to pay and in many cases the highest average housing prices in the country; And whereas currently, municipalities have only nine tax classes that can be used to set property taxes to achieve municipal goals: Class 1 Residential; Class 2 Utilities; Class 3 Supportive Housing; Class 4 Major Industry; Class 5 Light Industry; Class 6 Business Other; Class 7 Managed Forest Land; Class 8 Recreational Property; Non-Profit Organization; and Class 9 Farm; And whereas there have been minor amendments, the basic structure of this property tax class system has not be substantially amended since the 1980s; And whereas with the creation of new tax classes each municipality could set different tax rates for each class based on their individual needs and circumstances. As an example, different residential classes could be created to address vacant houses, non-residents ownership, etc: Therefore be it resolved that UBCM ask the provincial government to explore the merits of establishing new property tax sub-classes, or amending the existing residential tax class, as a tool to address housing affordability.
Ministry of Municipal Affairs The Ministry of Municipal Affairs and Housing is actively engaged in supporting governments top priority of making housing more affordable for all British Columbians. The idea of creating new property tax sub-classes or amending the existing residential tax class to address housing affordability has merit as it would provide local governments more flexibility in setting tax rates for different types of properties. However, there are a number of reasons why this Ministry and the Ministry of Finance have not in the past supported this approach. To provide some context, British Columbia already has more property classes than most jurisdictions across Canada, and any changes would further complicate the assessment process. And, unless the Province prescribes the tax rates or a methodology to determine the tax rate ratios, there is no guarantee that the sub-classes or additional classes would be used as the Province intended, particularly when the real estate market shifts or when there is a shift in priorities. It is also important to note that this approach would result in a redistribution of the tax burden within and between classes. In summary, the Province is not at this time considering new property sub-classes or amending the existing residential tax class, but is exploring other levers to address the issue of housing affordability.