Whereas concern around housing affordability is widespread in British Columbia communities, and the Land Value Tax provides a fiscal mechanism to incentivize improvements to property for housing and other purposes, and creates a disincentive to holding vacant property for speculative purposes; And whereas local governments in British Columbia previously had the authority to introduce Land Value Taxestaxing land at a higher rate than improvements: Therefore be it resolved that the Government of British Columbia restore the authority of local governments to introduce a Land Value Tax, to incentivize improvements to property for housing and other purposes, and create a disincentive to holding vacant property for speculative purposes.
Ministry of Municipal Affairs Housing One of the Provinces top priorities is supporting our local governments in addressing housing affordability for British Columbians both renters and buyers. To help address this goal, the Minister of Municipal Affairs and Housing, has met with several mayors to discuss comprehensive housing solutions. The Ministry has received UBCMs Housing Strategy and looks forward to continuing to work together on recommendations included in the report. The municipal variable tax rate system does not allow for a land value tax separate from improvements because it could potentially be used to set high rates on undeveloped or underdeveloped land. It is important to note that such land is already assessed at its highest and best potential use. Thus vacant land often has a high value for tax purposes. In addition, vacant land is often assigned to Class 6 Business and Other until the potential use of the property can be refined through the municipal planning and zoning process. The Class 6 tax rate is much higher than the residential tax rate. Thus, there is already a significant tax burden on vacant land. To allow additional taxes to be levied against vacant land would be inequitable because the municipality would be using the assessment and tax system to essentially levy a vacancy penalty. Instead, the Province provides municipalities with other tax mechanisms to incentivise property development like the revitalization tax exemption under S.226 of the Community Charter, which may be used to provide a tax reduction in order to expedite new development on vacant and under-utilized land.