A government spokesperson did not directly explain the rationale of why waterfront estate homes like this one north of Osoyoos get a 50 per cent break on their land assessments for education and other taxes. This and neighbouring properties are in the Agricultural Land Reserve, but there was no obvious evidence of farming on these lots that range from about a half to one acre. NDP Housing Critic David Eby questions the government’s motives for this break. (Richard McGuire file photo)
The NDP housing critic is questioning the provincial government’s motives in allowing non-agricultural rural estate homeowners to take advantage of assessment breaks intended for farmers.
David Eby was responding to issues raised by a recent Osoyoos Times investigative story that reported some local rural homeowners are paying less in taxes than their neighbours because their land is improperly classed as agricultural.
“The fact that this activity continues to take place and there’s so little response from government makes me wonder whether they have any intention of enforcing these rules at all,” said Eby.
“I worry that this government doesn’t enforce it because it’s not in the best interest of, for example, their donors.”
The Osoyoos Times found examples of properties that were assessed well below their market value because they were classed as farmland, even though the properties were not being farmed.
Additionally, a number of luxury waterfront homes were assessed at market value, but their owners get a 50 per cent reduction on the value of their land for education and other taxes because they live in the agricultural land reserve (ALR).
“It’s part of a systemic issue within government,” said Eby. “They often have rules that look very good on paper, but the enforcement is nonexistent. People clearly are taking advantage of tax breaks that were not intended for them.”
The B.C. government was given an opportunity to respond and a spokesperson for the Ministry of Community, Sports and Cultural Development sent an emailed reply.
In response to a question about non-farm residential properties benefiting from below-market assessments, the statement reiterated the government’s policy of helping farmers without directly answering the question.
“There is a longstanding policy to support farmers in the production of food by prescribing land values for farm class properties at a regulated rate, less than market value,” the statement said.
“In order to qualify for assessment at the lower regulated values, a property must meet the criteria for farm classification. To qualify for farm classification, a property must produce a minimum income annually from the sales of qualifying agricultural product,” the statement continued, noting that this threshold is $2,500 or $10,000 depending on the size of the farm.
“Properties that do not qualify would be classed as residential and valued accordingly at market value. Government regularly reviews the system to ensure the policies that are in place are fair and equitable,” the statement said.
Eby said he’s concerned about mega homes being built on agricultural land that is not farmed.
“The government needs to have the capacity to ensure that tax breaks for farmers actually go to farmers and don’t go to people building luxury homes,” he said. “And if the government doesn’t have that capacity, then that really undermines the entire structure and the point of trying to protect agricultural land.”
If the government really believed in protecting farmland to provide food security, it would enforce the rules, he said.
The ministry spokesperson said that if properties are being incorrectly assessed, there’s an audit process being applied on an ongoing basis to ensure compliance with tax policy.
“Government continues to monitor assessment in co-operation with BC Assessment to ensure current tax policies are being applied correctly and only to eligible properties,” the government statement said.
Government officials are currently looking into concerns raised in a report by Metro Vancouver, released in September 2016, which drew attention to the issue.
“If there are actions government can take to ensure possible tax loopholes are closed and the intent of our rules are reflected in what is happening on our farmland, we will look at taking appropriate action,” the spokesperson said.
Eby argued that if rules aren’t enforced and land is used for luxury housing, it drives up the cost of land that farmers depend on, making it more expensive to farmers, and providing an incentive to build luxury homes instead.
RICHARD McGUIRE
Osoyoos Times
