After spending some time inside Lakeridge Homes in Penticton, Premier John Horgan and Mayor Andrew Jakubeit walk to a podium to make an announcement about adding protections for manufactured homeowners. Dustin Godfrey/Western News

Horgan has ‘no expectation’ of speculation tax in Penticton

But the premier left the door open to future expansions beyond the current scope

The B.C. government has “no expectation” to implement the newly created speculation tax in Penticton said Premier John Horgan.

Though he didn’t close the door on the idea entirely.

The comment came at an announcement in Penticton on Tuesday morning that the province will be ramping up protections for homeowners in the case of landlords closing or converting manufactured home parks. During the short question period afterwards Horgan faced questions surrounding the speculation tax, including whether or not it would come to Penticton.

Related: Speculation tax could affect up to one in five Penticton homeowners

“We have no expectation of it moving south to the Penticton area. But interestingly, at the breakfast that I had this morning, we had people saying that they’re fearful that the speculation will move south and we may well have to follow it,” Horgan said.

“Our objective has always been to make life more affordable for British Columbians, and I’m not going to apologize for that.”

Penticton MLA Dan Ashton has previously expressed fears the tax would be moving to Penticton, and said he wasn’t assured by Horgan’s statement. Ashton pointed to the 2018 budget from the B.C. government as further evidence the tax could be expanded.

Related: Regulations drive early South Okanagan housing spike, could mean decline

“The new annual property tax will initially apply to Metro Vancouver, Fraser Valley, Capital and Nanaimo regional districts and in the municipalities of Kelowna and West Kelowna,” page 80 of the budget reads.

“The key, here, is ‘the new property tax will initially apply,’ so that means — the way I look at that, is they’re contemplating putting this throughout B.C.,” Ashton said.

The relatively small size of Penticton likely won’t matter when it comes to the tax, according to Ashton, who pointed to West Kelowna as an example.

Related: Fears of economic downturn cool Penticton developers’ ambitions

“They’re looking at high net-worth homes … that are not inhabited by people who live in them all the time,” Ashton said. “It was like taxation on the fly. They initiated it without a lot of thought and they’ve already had to backtrack once.”

Since the budget, the provincial government scaled back the scope of the tax, with a discounted rate for B.C. residents at 0.5 per cent, a one per cent rate for out-of-province Canadians and a two per cent rate for non-Canadians.

The government also announced it would be limiting the tax to urban centres — exempting rural cabins and cottages — and to properties valued greater than $400,000.

Related: Real estate agents brace for speculation tax impact

At the announcement, Horgan also said he spoke Tuesday morning with Mayor Doug Findlater of West Kelowna, who has been an outspoken critic of the tax.

“He handed me a package that I’ll share with the minister of finance when I return to Victoria. But we have to go back to, I believe, first principles,” he said.

“The mayor here (in Penticton) quite rightly pointed out that there is an affordability challenge when it comes to housing right across British Columbia, but particularly in large population centres.”

Horgan said 99 per cent of B.C. residents will not be affected by the tax, adding that he believed most were in favour of the tax.

Related: B.C. real estate group predicts dip in home sales, not in prices in 2018

Indeed, Ashton and the B.C. Liberals’ fight against the tax may be an uphill one.

According to an Insights West poll published March 1, the tax found 81 per cent support from residents, including a majority (54 per cent) who said the tax was a “very good idea” and just over a quarter (27) who thought the tax was a “good idea.”

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Dustin Godfrey | Reporter

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