You had to figure that governments would eventually find a way to tax the wealth locked up in houses that have soared in value.
Only a federal government with a death wish would touch the personal residence exemption, which lets you sell your principal residence without having to pay tax on your capital gain. That leaves property taxes, which typically treat all homeowners equally by applying the same tax rate against the assessed value of their home.
British Columbia’s NDP government broke with this tradition in its spring budget and went after expensive homes, of which there are plenty in the province. Starting next year, owners of houses with an assessed property valued between $3-million and $4-million will pay an additional 0.2 per cent of what’s known in the province as a school tax. An extra 0.4 per cent will apply on home values above $4-million.
The angry reaction to this measure reminds us that homeowners consider rising home equity to be off limits to taxation. But do governments? Homeowners, keep an eye on this story. It’s possible that the tax aspect of home ownership is about to change a little bit.
Full Story here: https://www.theglobeandmail.com/investing/personal-finance/article-a-line-has-been-crossed-on-taxing-soaring-home-values/