Records show cabinet spends more money collecting an equity tax on vacant, foreign-owned properties than it raises in revenue, according to Blacklock’s Reporter. “Why can we not make the government simpler?” said Conservative MP Adam Chambers (Simcoe North, ON) in a speech in the House of Commons. The Canada Revenue Agency said in an inquiry of ministry tabled in the House of Commons it collected $49 million through the underused housing tax since 2022. Revenues were a fraction of the $175 million per year anticipated by Finance Canada. Administration costs over the same period totalled $59 million — 20% more than what was collected in taxes. A total of 351 Canadian government employees were assigned to the paperwork. These figures were disclosed at the request of Chambers, who asked how many foreign buyers' tax returns have been filed. Of the 578,910 returns filed to date, 478,220 had no amounts owing.Parliament passed the Underused Housing Tax Act in 2022. It charged a 1% annual equity tax on the assessed value of vacant or underused residential properties owned by foreigners. Finance Minister Chrystia Freeland called this “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.”Cabinet introduced numerous amendments, including a waiver on vacation properties. Chambers said in another speech in the House of Commons the measure was too complicated. “Members said that better is always possible,” he said. “That sounds really nice but why does someone not say, ‘Why can we not make the government simpler?’”He offered to give an example. The Canadian government has an idea for an underused housing tax. If people do not use their house for personal reasons, they would fill out a form and prove it is an allowable use for which they do not have to pay the tax. However, the form is six pages long. “If they try to figure out whether they qualify for an exemption, it is confusing to even the most sophisticated accountants,” said Chambers. “They would have to do the form every single year.”The House of Commons Trade Committee (CTC) urged cabinet in November to review its 2022 equity tax on vacant, foreign-owned properties. READ MORE: Canadian MPs say they are uneasy with foreign buyers tax“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 CTC.“In that context, the government should review the tax’s design features, including its exemptions.”
Records show cabinet spends more money collecting an equity tax on vacant, foreign-owned properties than it raises in revenue, according to Blacklock’s Reporter. “Why can we not make the government simpler?” said Conservative MP Adam Chambers (Simcoe North, ON) in a speech in the House of Commons. The Canada Revenue Agency said in an inquiry of ministry tabled in the House of Commons it collected $49 million through the underused housing tax since 2022. Revenues were a fraction of the $175 million per year anticipated by Finance Canada. Administration costs over the same period totalled $59 million — 20% more than what was collected in taxes. A total of 351 Canadian government employees were assigned to the paperwork. These figures were disclosed at the request of Chambers, who asked how many foreign buyers' tax returns have been filed. Of the 578,910 returns filed to date, 478,220 had no amounts owing.Parliament passed the Underused Housing Tax Act in 2022. It charged a 1% annual equity tax on the assessed value of vacant or underused residential properties owned by foreigners. Finance Minister Chrystia Freeland called this “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.”Cabinet introduced numerous amendments, including a waiver on vacation properties. Chambers said in another speech in the House of Commons the measure was too complicated. “Members said that better is always possible,” he said. “That sounds really nice but why does someone not say, ‘Why can we not make the government simpler?’”He offered to give an example. The Canadian government has an idea for an underused housing tax. If people do not use their house for personal reasons, they would fill out a form and prove it is an allowable use for which they do not have to pay the tax. However, the form is six pages long. “If they try to figure out whether they qualify for an exemption, it is confusing to even the most sophisticated accountants,” said Chambers. “They would have to do the form every single year.”The House of Commons Trade Committee (CTC) urged cabinet in November to review its 2022 equity tax on vacant, foreign-owned properties. READ MORE: Canadian MPs say they are uneasy with foreign buyers tax“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 CTC.“In that context, the government should review the tax’s design features, including its exemptions.”
