11/06/21

CANADA: Offshore foreigners banned from buying Canadian property.

As published on westernstandardonline.com, Thursday 10 June, 2021.

There is now a temporary ban on offshore foreigners buying property in Canada, says Blacklock’s Reporter.

The Commons on Wednesday voted 180-147 in favour of the ban, put in place as housing prices soar on some areas of the country.

“Housing has never been less affordable,” said Conservative MP Brad Vis (Mission-Matsqui, B.C.), sponsor of the motion.

“Both the prime minister and the finance minister acknowledge we have a housing supply crisis.

“Will the government take concrete action?”

“We have not waited for the Conservatives,” replied Prime Minister Justin Trudeau.

The Liberals, effective next January 1, will impose a 1% annual equity tax on “underused” residential properties owned by foreigners outside the country,

“Canada’s first national tax on vacant property owned by non-resident non-Canadians,” said Trudeau.

Finance Minister Chrystia Freeland in April 30 testimony at the Senate national finance committee said the foreigners’ tax will be worth an estimated $175 million a year.

“This is an important measure,” said Freeland.

“We don’t want to encourage any sort of speculation on housing. Housing is such an important issue for all of us. Given that our population is growing we must build, build and build again new housing every year.”

“Housing must be there to provide shelter for Canadian families. Housing shouldn’t be taken over by speculators. That tax is one of the measures we’re bringing in to ensure that remains the case.”

Cabinet in 2016 amended the Income Tax Act to prohibit non-Canadians from claiming a capital gains exemption on property bought then sold within a year. The finance department at the time said it was “closing loopholes” following an “in-depth analysis of the housing market.”

Foreign investors from China, the U.S. and other countries own at least 10% of condominiums in downtown Toronto and 7.5% in Vancouver, according to a 2016 report by CMHC.