The Canadian government will not be taxing home equity — at least not under the current administration. Minister Ahmed Hussen, who oversees the country’s housing portfolio, said they will not entertain a tax on home equity, today. This comes after increasing calls from academics, and even banks, to consider doing so. It also comes just a few days after the industry said they would move to shut down any talk suggesting the country consider the option.
Canada Will Not Tax Home Equity Under This Government
The Minister, who oversees the country’s housing policy, flat out said it’s not an option. They aren’t just not taxing, he made it clear they will not even consider it. “Our government is not thinking, or considering… or bringing a home equity tax,” said Minister Hussen in parliament. He followed with, “Any suggestion is false… we have clarified that a number of times.”
The minister launched into a rant, to emphasize it will never happen while they’re in power. “… have clarified that a number of times. And I will keep saying that, over and over again. We are not considering that, and we are not implementing that..”
Experts Have Been Increasingly Calling For A Capital Gains Tax
The statement follows calls to consider a home equity tax, from groups not typically into taxes. Last week the Globe’s editorial board urged the country to consider a capital gains tax. RBC, the country’s largest bank, even made a case to consider taxing capital gains. Both groups clarified it will be unpopular, but the issue is now beyond housing affordability. RBC went so far as to say home prices at this level can have a destabilizing effect on the whole economy.
Real Estate Industry Said They Will “Shut Down” Talk
Canada’s real estate industry hasn’t been so keen on the idea, arguing it’s unfair to homeowners. Last week TRREB, the country’s largest real estate board, sent an email to agents saying they will “shut down” the conversation. The email also mentions the support of other real estate associations, including CREA. The latter has over 130,000 members, and wields significant influence these days.
Canada isn’t alone in talk of home equity taxes, as real estate prices everywhere rise. While not as much as Canada, low interest rates are pushing other countries higher as well. France, New Zealand, and South Korea are just a handful of countries moving to tax home equity. The aim is to level the field with productive investment, by eliminating property tax advantages.
Like this post? Like us on Facebook for the next one in your feed.