Jean Swanson, one of the candidates in this fall’s by-election for Vancouver City Council, has recently proposed a mansion tax. Under her proposal, property taxes would be tiered in much the same way that income tax is tiered — the lower your property value, the lower your property tax rate would be.
In making her point, Jean made her announcement in front of Lululemon founder Chip Wilson’s $76-million home in Point Grey. The mansion tax would see the owners of homes valued at $5 million and up to $10 million pay an additional 1 percent in property taxes. For homes worth $10 million or more, owners would pay an additional 2 percent. In Chip’s case, for instance, she says it would mean paying an additional $1.7 million over the $195,000 in property taxes he’s already paid.
The revenue generated by this additional mansion tax, which she estimates to be about $174 million annually, would be used to help address the crisis of homelessness in Vancouver.
Jean’s proposal seems to have captured the imagination of many civic watchers, including me: It’s a doable idea. It makes sense. It would only affect a small percentage of Vancouver’s homeowners.
If we can tier income tax, why can’t we do the same thing for property taxes? As a society, we accept the idea that those with higher income should have their income taxed at a higher rate. Most would be strongly opposed to a flat tax on income. But we currently have a flat tax on property. Whether you own a postage-stamp-sized $200,000 condo or a sprawling, 10-bedroom property worth tens of millions of dollars, your property is now taxed at the same rate.
Let’s hope Jean’s idea catches fire. Regardless of who wins the municipal by-election, it would be great to witness her proposal implemented at 12th and Cambie.