In the past, we have put out articles regarding the British Columbia Speculation and Vacancy Tax (the “Speculation Tax”) and its expansion into more regions throughout BC. Still, many property owners in the new regions have questions about the Speculation Tax and the available exemptions.
This will be the first article in a series that will describe the Speculation Tax and some of the most common exemptions available for property owners who are declaring for the first time.
The Expansion of the Speculation Tax
The BC Government introduced the Speculation and Vacancy Tax Act in 2018 with the intention of reducing the number of vacant properties in BC and quelling speculative investment in real property. In 2022, the number of regions affected by the Speculation Tax increased and more property owners were required to make yearly declarations or face penalties.
| 2018 Regions | 2022 Expansion Regions |
|---|---|
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The latest expansion of the Speculation Tax, which occurred in 2023 (applying to the 2024 tax year), required even more property owners to make declarations about how they use their property. Property owners in the following regions were required to make their declarations before March 31, 2025:
| 2023 Expansion Regions | |
|---|---|
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The Speculation Tax Rate and the Recent Increase.
When the Speculation Tax was first introduced, the rate of tax was modest for BC Residents and most Canadian citizens and permanent residents, with a higher rate of tax applying to foreign owners and a subset of Canadian citizens and permanent residents, which the BC government calls members of satellite families.
On March 4, 2025, as part of the provincial government’s Budget 2025, it was announced that beginning in the 2026 taxation year, the Speculation Tax rate will increase for all non-exempt property owners, with BC residents and Canadian citizens who do not qualify for an exemption paying 1% of their assessed property value and foreign owners and members of satellite families paying 3%.
| Original Speculation Tax Rate | 2026 Speculation Tax Rate |
|---|---|
| BC residents and Canadian citizens = 0.5% | BC residents and Canadian Citizens = 1% |
| Foreign owners and satellite families = 2% | Foreign owners and satellite families = 3% |
What this Means for Property Owners
For many property owners in newly added regions, January 2025 marked their first Speculation Tax declaration; some of those owners were surprised to find that they did not qualify for an exemption. With the new increase, those same owners will face double the tax burden beginning in 2026 if they do not implement a strategy to qualify for an exemption.
In the short time that the Speculation Tax has existed, it has spread to significantly more regions throughout the province. With the most recent announcement, the tax rate has dramatically increased to a level that is unsustainable for many owners who do not qualify for an exemption. In our subsequent articles, we will outline some of the most common exemptions and the nuances of those exemptions that property owners should know.
If you need more information about the Speculation Tax and the available exemptions and their requirements, Pushor Mitchell is here to assist you.
If you would like to learn more about the Speculation and Vacancy Tax and how it may affect you or your BC property, reach out to Kyle Ramsey at [email protected] or give him a call at 250-869-1259.
