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

Just Posted

Crews work to repair Horsefly Road east of Williams Lake . (Ministry of Transportation video)
MoTI activates district operations centre, response to flood damaged roads in Cariboo region

Engineers, experts being pulled from across the province to help

Jean Atkinson of Richbar Golf and Gardens says maple trees are the most popular shade tree sold by the nursery. (Black Press File Photo)
GARDENING WEEK: Maple trees provide shade, piece of Canadiana

Jean Atkinson from Quesnel’s Richbar Golf and Gardens says maples are their most popular shade tree

Health-care workers wave to people clapping and yelling thank you to the frontline workers during the 7pm tribute outside the Lions Gate Hospital in North Vancouver, B.C. Wednesday, April 8, 2020. (THE CANADIAN PRESS/Jonathan Hayward)
COLUMN: Front-line workers bearing mental strain of pandemic

Cassidy Dankochik’s column as seen in the May 12 edition of the Quesnel Cariboo Observer

Fraser River GM stopped by Big Brothers Big Sisters of Quesnel with a donation of 500 face masks Friday, May 7. (Fraser River Chevrolet Facebook photo)
Quesnel vehicle dealership helps mask those in need

1,000 face masks donated to Big Brothers Big Sisters and Salvation Army

Correlieu Secondary School made the announcement on their Facebook page. (file photo).
COVID-19 case detected at Correlieu Secondary School in Quesnel

This case marks the seventh time COVID-19 has been detected in the Quesnel School District

Daily confirmed COVID-19 cases reported to B.C. public health, seven-day rolling average in white, to May 12, 2021. (B.C. Centre for Disease Control)
B.C. preparing ‘Restart 2.0’ from COVID-19 as June approaches

Daily infections fall below 500 Friday, down to 387 in hospital

The warm weather means time for a camping trip, or at least an excursion into nature. How much do you know about camps and camping-related facts? (John Arendt - Summerland Review)
QUIZ: Are you ready to go camping?

How many camp and camping-related questions can you answer?

On Friday, May 14 at Meadow Gardens Golf Club in Pitt Meadows, Michael Caan joined a very elite club of golfers who have shot under 60 (Instagram)
Crowds at English Bay were blasted with a large beam of light from an RCMP Air-1 helicopter on Friday, May 14. THE CANADIAN PRESS/Marc Grandmaison
Police enlist RCMP helicopter to disperse thousands crowded on Vancouver beach

On Friday night, police were witness to ‘several thousand people staying well into the evening’

People shop in Chinatown in Vancouver on Friday, February 5, 2021. THE CANADIAN PRESS/Jonathan Hayward
Vancouver community leaders call for action following 717% rise in anti-Asian hate crimes

‘The alarming rise of anti-Asian hate in Canada and south of the border shows Asians have not been fully accepted in North America,’ says Carol Lee

Sinikka Gay Elliott was reported missing on Salt Spring Island on Wednesday, May 12. (Courtesty Salt Spring RCMP)
Body of UBC professor found on Salt Spring Island, no foul play suspected

Sinikka Elliott taught sociology at the university

The first Black judge named to the BC Supreme Court, Selwyn Romilly, was handcuffed at 9:15 a.m. May 14 while walking along the seawall. (YouTube/Screen grab)
Police apologize after wrongly arresting B.C.’s first Black Supreme Court Justice

At 81 years old, the retired judge was handcuffed in public while out for a walk Friday morning

Dr. Steve Beerman, of Nanaimo, shows off his Dr. David Bishop Gold Medal, awarded for distinguished medical service. (Karl Yu/News Bulletin)
Queen presents Vancouver Island doctor with award for global drowning prevention

Dr. Steve Beerman receives Royal Life Saving Society’s King Edward VII Cup at virtual ceremony

Former UFV Cascades wrestling coach Arjan Singh Bhullar is now the ONE heavyweight champion after defeating Brandon Vera via TKO in round two on Saturday in Singapore. (ONE Championship)
Former UFV wrestling coach wins MMA championship

Arjan Singh Bhullar captures ONE heavyweight title, first Indian origin fighter to achieve honour

Most Read