On February 17, 2026, British Columbia's 2026 Budget was introduced by finance minister Brenda Bailey. The budget contains the following measures that impact those investing in, owning, developing and providing services related to real estate in British Columbia:
1. Increase in Additional School Tax Rates - Effective for the 2027 Tax Year
Commencing with the 2027 tax year, the school tax rate for residential property that is over $3,000,000 in value is increased.
- From 0.2% to 0.3% for the residential portion of value assessed between $3,000,0000 and $4,000,000; and
- From 0.4% to 0.6% for the residential portion of value excessed beyond $4,000,000.
Generally, the additional school tax applies to condominiums, single family homes, townhouses and vacant land assessed at over $3,000,000. For properties that are mixed-use, the school tax rate only applies to the portion of the property that is residential with an assessed value above $3,000,000.
2. Expansion of the Application of Provincial Sales Tax (“PST”)
PST currently applies to the provision of certain goods and services. As of October 1, 2026, the scope of services to which PST applies will be expanded to include accounting, bookkeeping, architectural, engineering, geoscience, rental property management, strata management, commissions related to the sale of non-residential real estate (commercial real estate) and security services. Businesses providing these aforementioned services will need to collect and remit PST. However, it is noted that a reduced rate of PST will be exigible on architectural, engineering, and geoscience services i.e. the current 7% rate will be exigible on 30% of the purchase price of those services.
3. Increase in Speculation and Vacancy Tax rates
As of January 1, 2027, the Province is increasing the Speculation and Vacancy Tax Act rate for “foreign owners” and “untaxed worldwide earners” from 3% to 4%. This change applies to the declared use of a residential property during the 2027 tax year onward.
4. Increased Interest Rates for the Property Tax Deferment Program
Effective for the 2026 and subsequent taxation years, in order to more closely align with commercial lending terms, interest rates offered for provincial property tax deferment programs through both the regular program and families with children program are increased to a rate of prime plus 2% compounded monthly. Any amounts deferred prior to the 2026 taxation year will be subject to the interest rate terms in the applicable deferment agreement.