What a surprise excessive Taxes on Airbnb isn’t helping to fix the rental crisis in British Columbia – November 10, 2019,
Nothing is better for big business than government contracts or government guarantees. As an example, the climate change taxes or carbon pricing whatever it is Leftist call it, these government initiatives benefit big corporations, because there are giant hurdles people and business need jump over in order to even be considered in most instances. Now, when a politician presents this idea to people who don’t understand common sense economics, it sounds wonderful.
Wow, politician such and such is promising the poor free stuff, what a great person that politician is, going after the rich to give to the poor, this is typically how politicians present themselves, the problem, of course, is the execution, business people are incentivized to do things in an efficient manner, unfortunately governments, especially big governments aren’t designed to do anything efficiently and this is of course what leads to poverty.
Public-sector unions have a legal right to exist in Canada, and whether you like it or not, public sector unions drive prices up for consumers, this is one of the main reasons why the municipal and provincial governments are reluctant to build housing for the poor. Now, in the past a lot of charities used to build housing, in fact, co-op housing was something I was involved in via the church, the challenging way back when I was involved were the regulations imposed by the Ontario government.
Tenant rights exist and if contributing to the co-op was something some people didn’t want to do after being given housing, hands were tied and there was little that could be done. You see human beings are complicated, some so-called poor people want to eat a steak dinner on a pork and beans salary. Furthermore, the destruction of private property often occurs at the hands of people who the government deems poor because things like rent controls exist, landlords have to make their profit before the tenant signs the lease.
Meaning that if there’s no rent controls, when disaster strikes landlords can raise rents, now, you might argue this is cruel, how dare a landlord do this to poor people, well prior to a lot of unnecessary regulations, what a particular landlord did wasn’t important because there were an abundance of other options on the market, abundance drives rental prices down and also forces landlords to provide value to their tenants.
Actually, in this technological era, this is the best time to get rid of rental controls, because a simple online Google or Bing search for a property will tell prospects all they need to know about a particular rental establishment. The problem is Canada has been doing things in reverse, we’re growing the size of government and raising taxes in an era where we should be getting rid of unnecessary regulations and cutting taxes. The reality is real estate agents are obsolete next to technology, what’s saving real estate agents is the same thing that’s saving the Taxi industry… THE GOVERNMENT!
Airbnb is not really a disruptor in the market, it exists primarily because of government over-regulation. Uber and Airbnb are clear signs that governments all over the world are bloated and inefficiently run. With the exception of the APP itself, there’s nothing really innovative about Uber or Airbnb, these things existed prior to the creation of many of these government regulations, the only difference being they couldn’t put it into an APP, so basically you’d have to know somebody who knew somebody and viola you’d have a place to stay on vacation or your own personal cab driver.
In Canada, we created something called the CMHC and it incentivizes condo building over building rental housing. Prior to CMHC getting involved in mortgage insurance, condos were built based on residential consumer demand, consumers prior to CMHC were more demanding, because borrowing money was more expensive and their down payments were much larger. But in the modern era of O% down or even CMHC downpayment loans, almost every condo development gets financed and ultimately built in areas where rental housing would have been more beneficial to the poor. Regressive taxation hurts the poor the most, because the poor have to pay retail prices for everything.
The wealthy don’t pay retail prices, they charge retail prices. The disaster the CMHC created often works like this, people with the capital buy the condo and the low price and then sell it to the Canadian looking for a place to live at a much higher price, this too benefits the government because taxes are charged on the sale of the property and n many instances CMHC and all levels of government have a permanent debt slave, paying for their death pledge.
NDP Premier of British Columbia John Horgan – 36th Premier of British Columbia
Here’s a list of all the taxes people pay on a litre of gas in B.C.:
Provincial motor fuel tax (Metro Vancouver) — 1.75 cents
Provincial motor fuel tax (everywhere else in B.C.) — 7.75 cents.
B.C.’s carbon tax — 8.89 cents.
The B.C. Transportation Finance Authority tax — 6.75 cents.
TransLink tax (If you live in Metro Vancouver) — 17 cents, increasing to 18.5 cents on July 1.
Transit tax (If you live in Victoria) — 5.5 cents.
Federal excise tax — 10 cents.
Finally, pay the five per cent Goods and Services Tax on top of the total price.
The worst part about all of these condos being built is that wealthy people and even criminals can park money into condos which the government benefits from it, via property taxes. It’s hard to park money into a rental housing unit, so basically the B.C government does what every Leftist government does which is blame the well known rich and use this blame the rich concept as an excuse to charge poor people more taxes. Recently NDP leader Jagmet Singh, was trying to point blame at a rich American entertainer for daring to be part of condo development in Toronto? John Horgan is an NDPer and the housing crisis in B.C has worsened, but you see the rich American entertainer is an easy target to point the finger at. Let’s blame the well known rich person for a problem their government doesn’t want to solve, because telling the truth would equate to a rethink in Canadian politics.
Airbnb has been the target of the left as has Uber, but clearly, as I’ve stated in other posts, Uber is nothing more than APP that is making it easier for people to do what they were already doing on a smaller scale in the past.
People want to save money, it’s just the world we live in, and being that Public Sector workers also have the right to unionize the government would be wise to start limiting its exposure to the rental markets. I personally don’t think CMHC should be a FEDERAL crown corporation, if people want it, it should be a provincial crown corporation. Because combining CMHC with provincial rental controls is a recipe for disaster. It’s so obvious what the problem is, but hey, maybe Canada simply wants to learn things the hard way. Consider the free market, technology, and the free market are a match made in heaven!
