Singh to target ‘big-money’ house-flippers by hiking taxable amount of capital gains
Published August 31, 2021 at 3:07 pm
|COQUITLAM, B.C. — The NDP leader promised Tuesday to crack down on “big-money” house flippers by increasing the taxable amount of capital gains profits from 50 to 75 per cent.|
Jagmeet Singh made the announcement in Metro Vancouver, an area where the NDP hopes to attract voters who are frustrated with housing prices that have skyrocketed out of reach of many middle-class families.
“One of the big problems that we’re seeing is that very wealthy investors are using the housing market like a stock market,” he said.
“And we want to tackle that. We want to get big money out of housing.”
He said his plan would target wealthy speculators who buy affordable homes, renovate them quickly and resell them for profit, while using what he describes as the capital gains loophole to not pay their “fair share” of taxes.
Liberal Leader Justin Trudeau has refused to close the loophole even though it has a billion-dollar price tag and 88 per cent of it goes to the richest one per cent of Canadians, Singh said.
A capital-gains tax is applied on the sale of an investment asset, like a stock share or real estate property, but does not apply to a primary residence and Singh says he has no plans to change that.
The Liberals proposed last week an anti-flipping tax on residential properties, requiring that such homes be held for at least 12 months.
Singh criticized the proposal saying it doesn’t address the problem but simply “pushes it down the road that is not going to make a difference.”
He pointed to high levels of money laundering in British Columbia. The provincial New Democrat government appointed B.C. Supreme Court Justice Austin Cullen in 2019 to lead a money laundering inquiry after four reports concluded the flow of hundreds of millions of dollars in illegal cash linked to organized crime impacted the province’s real estate, luxury vehicle and gaming sectors. Cullen is expected to finish his report in December.
Singh said money laundering has also been driving up housing costs.
“We can also tackle that,” he said.
“And while the B.C. NDP has done a lot to tackle it provincially, it’s really something that needs federal partnership. The federal government is in the best position to tackle money laundering, and to tackle the illegal activities that are driving up the cost of housing.”
If elected, he said his government would ensure economic growth is not driven by rich investors who want to profit off housing or foreign investors who invest in the home real estate market and drive up costs.
“So, what we want to do is to unlock the ability of Canadians to buy their own home,” he said.
“To do that we need to tackle the housing crisis, we need to build more homes that are in people’s budgets, and that’s really our goal,” saying there needs to be a “holistic solution.”
His government would build 1.7 million homes, he said calling it a “bold step forward.”
“We’re proposing a suite of solutions to address all the problems,” Singh said. “It’s a plan that deals with all the concerns that people have.”
Hina Alam, The Canadian Press