Will critics of the NDP's speculation tax be appeased by the changes to the speculation tax announced yesterday?
Political Scientist Hamish Telford, at the University of the Fraser Valley, says while much of the criticism has likely been diffused, thanks to targeting urban area most people with recreational properties will now be exempt.
But he says there will still be critics and those being hit inadvertently -- and there's another issue:
"This is supposed to be a speculation tax, therefore you want to target speculators. But when you get down to it it's very difficult to know who is a speculator. There's not a form that you tick off when you buy a house that says -- oh yeah, I'm a speculator. And so it becomes difficult to design a tax that really targets the group that you want to target, whom you believe are driving up prices."
And Telford says the tax is complicated to understand,and will be expensive to impose:
" And I think this is going to prove a very expensive tax for the government to administer. It's only supposed to raise $200-million. And I suspect that there will be lots of appeals and people asking for exemptions from this, that or the other. And it's going to be difficult for the government to figure out. And speculators will just look at the new rules and adjust their activities accordingly. Okay, I can't speculate in West Vancouver, I'll speculate in Squamish which is outsider the zone".
Hamish says it's still not clear if speculation is responsible for driving up housing prices. He suspects it's more supply and demand.