Chart from the April 20 B.C. budget shows sharp dip in real estate sales early in the COVID-19 pandemic and the even steeper climb since late 2020. (B.C. government)

Chart from the April 20 B.C. budget shows sharp dip in real estate sales early in the COVID-19 pandemic and the even steeper climb since late 2020. (B.C. government)

Hot B.C. housing market drives property transfer tax gains

B.C. budget boosts tobacco, sweet drinks, carbon taxes

B.C.’s recovery from the COVID-19 recession of 2020 showed up most dramatically in a $5.5 billion improvement in the provincial deficit reported in the province’s latest budget, after it had been forecast to be $13.6 billion last fall in the depths of the pandemic.

While natural resource income recovered and lumber prices soared, B.C. reaped its most significant gains from strong income taxes and a surge in real estate that neither the province nor its private sector advisory board saw coming.

“This $5.5 billion improvement is mainly thanks to higher revenues, but also somewhat lower spending and improved operating results in government organizations, including ICBC,” Finance Minister Selina Robinson said in her budget presentation April 20.

The budget estimates that property taxes to the province are $2.3 billion for the year ended March 31, rising to nearly $3 billion for 2021-22. Property transfer tax took in $2 billion last fiscal year and is forecast to decline slightly to $1.97 billion in the current year, as the finance ministry forecasts a “moderation in market activity in 2022.”

Monthly home sales reached record levels in late 2020 and have continued to grow in 2021, with high-wage employment “resilient” in the pandemic, low interest rates and demand for larger homes by remote workers, budget documents say.

Real estate sales rose in every B.C. region in 2020, with Greater Vancouver sales up 75 per cent, Okanagan Mainline almost doubling at 94.6 per cent, Fraser Valley up 110 per cent and Greater Victoria sales up 60 per cent.

“Meanwhile, the average home sale price in B.C. increased by 11.6 per cent in 2020 compared to 2019,” the budget documents say. “Strong average sale price growth was observed in most markets in the province. Year-to-date to February 2021, prices were up by 16.5 per cent compared to the same period a year earlier.”

ICBC net revenue is estimated at $709 million for the year just passed, dropping to $154 million next year as major reforms in injury payouts are to take effect.

Provincial tobacco taxes continue to soar effective July 1, rising from 29.5 cents to 32.5 cents on a single cigarette. Provincial sales tax also applies to vaping products as of April 1.

RELATED: B.C. deficits add up to $19 billion in three-year budget

RELATED: B.C. budget offers COVID-19 aid to tourism, hospitality

An exemption of B.C.’s seven per cent sales tax for sweetened carbonated drinks ended April 1, and the province also required foreign streaming services such as Netflix and Disney+ to pay sales tax along with domestic services like CraveTV.

B.C.’s carbon tax increased to 9.96 cents on a litre of gasoline as of April 1, with another increase scheduled for April 2022. In Metro Vancouver, gasoline taxes are now 36.96 cents per litre, including TransLink, motor fuel tax and carbon tax.

Natural gas royalties are forecast to pick up quickly, from $191 million to $286 million this year and $315 million in 2022-23 as B.C.’s first large-scale LNG export project nears completion. Forest revenues and the mineral tax on coal mines are rising, with a 14 per cent increase estimated for this year. That is expected to fall 6.1 per cent in 2022-23, based mostly on lumber prices declining from current high levels.


@tomfletcherbc
tfletcher@blackpress.ca

Like us on Facebook and follow us on Twitter.

2021 B.C. BudgetBC politics

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Creston Town Hall. (Photo by Kelsey Yates)
Ellen Tzakis resigns from Creston Town Council

Council is preparing to hold a by-election later this year

RCMP are searching for Philip Toner, who is a 'person of interest' in the investigation of a suspicious death in Kootenay National Park last week. Photo courtesy BC RCMP.
Man sought in suspicious Kootenay death found in Lake Country

Philip Toner is a person of interest in the death of Brenda Ware

A health-care worker prepares a dose of the Pfizer-BioNTech COVID-19 vaccine at a COVID-19 vaccine clinic in Toronto on Thursday, January 7, 2021. THE CANADIAN PRESS/Nathan Denette
65 new cases of COVID-19 in Interior Health

Overall, B.C. is seeing a decrease in COVID-19 cases

School District 8 employees Shannon Tetz, Cheryl Rendek, and Janet Wall officially began their retirement with a COVID-friendly send-off outside of Prince Charles Secondary School. (Photo by Kelsey Yates)
School District 8 employees Shannon Tetz, Cheryl Rendek, and Janet Wall officially began their retirement with a COVID-friendly send-off outside of Prince Charles Secondary School. (Photo by Kelsey Yates)
Three women retire from School District 8 with COVID-friendly celebration

Shannon Tetz, Cheryl Rendek, and Janet Wall shared 87 years of service collectively

The Salmo Public Library’s director Taylor Caron with her award. Photo: Submitted
Salmo Public Library director wins provincial award

Taylor Caron has been recognized by her peers for innovation and advocacy

A bullet hole is seen in the windshield of an RCMP vehicle approximately 4 km from Vancouver International Airport after a one person was killed during a shooting outside the international departures terminal at the airport, in Richmond, B.C., Sunday, May 9, 2021. THE CANADIAN PRESS/Darryl Dyck
Homicide team IDs man in fatal YVR shooting as police grapple with spate of gang violence

Man, 20, charged in separate fatal shooting Burnaby over the weekend

Two-year-old Kashius Weme rides at the Steve Smith Memorial Bike Park in Nanaimo on Tuesday, May 11. The youngster’s precocious bike-riding ability is already attracting cycle sponsors. (Chris Bush/News Bulletin)
2-year-old B.C. bike rider already attracting cycle sponsors

Nanaimo’s Kashius Weme has a knack for extreme cycle sports

Keith MacIntyre - BC Libertarian
Penticton’s Keith MacIntyre new leader of the B.C. Libertarian Party

The Penticton businessman was voted in by members of the party on May 8

Vernon North Okanagan RCMP reported to 287 mental health calls between Jan. 1, 2021, and May 1. (Black Press files)
‘It’s not the police’s responsibility to deal with mental health calls’: Vernon RCMP

RCMP remind public to take care of mental health and well-being, while better solutions are sought

Thompson Rivers University campus is in Kamloops, B.C. (KTW file photo)
Thompson Rivers the 1st B.C. university to supply free menstrual products

The university will offer the products this September

Cannabis bought in British Columbia (Ashley Wadhwani/Black Press Media)
Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Fraser Health is using ‘targeted’ vaccination clinics in high-risk areas of the Lower Mainland. (Fraser Health photo)
B.C.’s COVID-19 decrease continues, 515 new cases Tuesday

426 seriously ill people in hospital, up from 415 Monday

The site of Sunfest, Laketown Ranch, will be open for camping this summer. (Citizen file)
Sunfest country music bash won’t be shining on B.C. in 2021

Annual Vancouver Island Festival cancelled due to COVID-19, along with Laketown Shakedown

Tla-o-qui-aht First Nation elected chief councillor Moses Martin, who was also Chantel Moore’s grandfather, speaks to media in Port Alberni on Aug. 16, 2020, during a visit from NDP leader Jagmeet Singh following the police shooting of Chantel Moore. (Elena Rardon photo)
Mother of 2 shot by police in critical condition, says B.C. First Nation chief

Community ‘devastated’ by third member of 1,150-person Vancouver Island nation shot in less than a year

Most Read