The House of Commons Trade Committee urged cabinet to review its 2022 equity tax on vacant, foreign-owned properties, according to Blacklock’s Reporter. “Recognizing that new policy measures do not always have the anticipated effects, the committee observes that as a matter of good practice, the Government of Canada should assess the design of a new tax, including any exemptions to ensure the intended goals are being realized,” said the Commons Trade Committee in a report.“In that context, the government should review the tax’s design features, including its exemptions.”Witnesses included one United States representative testifying the foreign buyers tax breached free trade rules. The Commons Trade Committee said friendly ties with the US “should be both maintained and strengthened.” It added cabinet should mitigate any potential negative impacts. The Canadian government introduced a $175 million a year tax on luxury vacant homes in 2021. READ MORE: Freeland taxes offshore buyers who let pricey property sit emptyThe move was aimed at rich offshore landlords who buy up pricey Canadian real estate and let it sit empty in places such as Vancouver.“The idea is if you’re living in the home, you won’t be subject to the tax,” said Chartered Professional Accountants of Canada Vice-President of Taxation Bruce Ball. Witnesses testifying at the committee said the tax penalized US citizens who lived part time in Canada. Democratic Rep. Brian Higgins (NY-26) said American families have owned Canadian homes for generations. “Many were surprised by the tax and only learned about it through their attorneys, accountants or news reports,” said Higgins. “Even for those who are exempt, it is costly and time consuming to figure that out.”When it comes to the United States-Mexico-Canada Agreement, Higgins said all parties cannot discriminate against each other or provide preferential treatment to domestic companies or citizens with respect to matters about internal taxation. The Underused Housing Tax does not apply equally to Canadian and US citizens. Cabinet justified the tax as a measure to ease shortages. Finance Minister Chrystia Freeland testified at the Senate National Finance Committee in 2021 that this is “an important measure.”“Housing shouldn’t be taken over by speculators,” said Freeland. “That tax is one of the measures we’re bringing in to ensure that remains the case.”
The House of Commons Trade Committee urged cabinet to review its 2022 equity tax on vacant, foreign-owned properties, according to Blacklock’s Reporter. “Recognizing that new policy measures do not always have the anticipated effects, the committee observes that as a matter of good practice, the Government of Canada should assess the design of a new tax, including any exemptions to ensure the intended goals are being realized,” said the Commons Trade Committee in a report.“In that context, the government should review the tax’s design features, including its exemptions.”Witnesses included one United States representative testifying the foreign buyers tax breached free trade rules. The Commons Trade Committee said friendly ties with the US “should be both maintained and strengthened.” It added cabinet should mitigate any potential negative impacts. The Canadian government introduced a $175 million a year tax on luxury vacant homes in 2021. READ MORE: Freeland taxes offshore buyers who let pricey property sit emptyThe move was aimed at rich offshore landlords who buy up pricey Canadian real estate and let it sit empty in places such as Vancouver.“The idea is if you’re living in the home, you won’t be subject to the tax,” said Chartered Professional Accountants of Canada Vice-President of Taxation Bruce Ball. Witnesses testifying at the committee said the tax penalized US citizens who lived part time in Canada. Democratic Rep. Brian Higgins (NY-26) said American families have owned Canadian homes for generations. “Many were surprised by the tax and only learned about it through their attorneys, accountants or news reports,” said Higgins. “Even for those who are exempt, it is costly and time consuming to figure that out.”When it comes to the United States-Mexico-Canada Agreement, Higgins said all parties cannot discriminate against each other or provide preferential treatment to domestic companies or citizens with respect to matters about internal taxation. The Underused Housing Tax does not apply equally to Canadian and US citizens. Cabinet justified the tax as a measure to ease shortages. Finance Minister Chrystia Freeland testified at the Senate National Finance Committee in 2021 that this is “an important measure.”“Housing shouldn’t be taken over by speculators,” said Freeland. “That tax is one of the measures we’re bringing in to ensure that remains the case.”
