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Global destinations that impose tax on foreign buyers

B.C. isn’t the only jurisdiction seeking relief from high home prices blamed on an influx of speculative foreign money. Hong Kong instituted a 15-per-cent surcharge on non-residents buying into the city’s hyperactive residential market back in 2012.

B.C. isn’t the only jurisdiction seeking relief from high home prices blamed on an influx of speculative foreign money.

Hong Kong instituted a 15-per-cent surcharge on non-residents buying into the city’s hyperactive residential market back in 2012. The tax, aimed at reducing speculation by wealthy mainland Chinese, is in addition to document and transfer taxes paid by Hong Kong resident buyers. Singapore charges a similar tax on foreign buyers.

Six years ago, Australia responded to rising prices in Melbourne and Sydney by implementing a ban on foreign purchases of existing housing unless the house is demolished and redeveloped in a way that increases the number of housing units. Foreign buyers are mainly restricted to buying new housing. Temporary foreign visitors can buy existing homes as long as they are resold before that person leaves Australia.

Denmark has a law against foreign ownership to the effect that non-EU nationals can’t buy a home unless they have lived in Denmark for five years, are employed there, and the home will be their principal residence. Denmark can also restrict non-Danish EU citizens from buying second homes in the country.

In Britain, lawmakers in London have made their property transfer tax steeply progressive and added an additional transfer tax on purchases made by non-residents. Foreign owners also face a higher capital gains tax when they sell.

The Swiss government imposes annual quotas on the number of homes that can be sold to foreign nationals.

The Philippines does not permit foreigners to buy land at all, although they can buy the house or condo that sits on the land.

Mexico technically doesn’t allow foreign buyers in areas anywhere within 100 kilometres of the border or 50 kilometres from the coasts. The government amended those restrictions to allow foreigners to buy properties in those areas through trustee arrangements with Mexican banks.

Source: Postmedia files