A pair of Yellowknife MLAs and the local real estate board is slamming a proposed hike to land title transfer fees in the legislative assembly Monday that will see most of the money come from property sales in the capital.

Under the plan, a $500,000 home would eventually see an extra $350 in fees added to property sales after the phase-in completes.

Justice Minister Louis Sebert acknowledged it was “likely” Yellowknifers would bear the brunt of the new costs; the majority of land title transfers take place in the city. Defending the proposed changes, Sebert said the costs would largely match the value of the home. More expensive purchases would see higher fees.

Fort Smith and Hay River residents would also face increased costs too, he said.

The fee would be phased in over three years. By the end of this period, the fee would rake in $500,000 annually. Sebert said the fee was due for an increase, noting it has been 25 years since it was implemented and it hasn’t been increased since.

Kam Lake MLA Kieron Testart said that and other taxes, such as airport fees, have become unbearable for his constituents and that he was unconvinced it was in their best interest.

“This is a fee that’s going to disproportionately affect ratepayers in one part of the territory and largely ignore the state of play in other parts of the territory,” he said.

He said he couldn’t support a measure that charged his constituents for the sole purpose of raising government revenue. “It’s a fee increase. It’s a half a million dollars that Yellowknifers will provide in revenues to the GNWT,” he said.

Yellowknife North MLA Cory Vanthuyne compared the fee to last year’s proposal for a land transfer tax, which drew fire from the Yellowknife Real Estate Board for its apparent unfairness. Seventy per cent of the revenue under that plan — which was expected to raise $3.1 million overall — would come from Yellowknife under that plan, Vanthuyne said.

The land transfer tax was eventually abandoned in favor of increases fees.

Yellowknife Real Estate Board President knocks increase

“It’s completely unfair to Yellowknife homeowners,” Yellowknife Real Estate Board president Adrian Bell said. “They’re calling it a fee, but it’s not a fee. It’s a tax.”

Bell sad he is certain that if the fee generates $500,000 by the time it’s fully implemented, $450,000 will come from city’s residents. He added there is little rationale behind the proposed increase beyond raising government revenue and “that it seems like Yellowknifers can afford it.”

“It’s death by a thousand cuts,” he said.

Sebert pointed out the fee would be a much a lower cost to property buyers than the previous proposal for a land transfer tax, which would have also been phased in over three years.

Vanthuyne similarly knocked the three-year phase-in aspect. Residents buy houses every five to 10 years, he argued, “you’re not buying a house every single year. It’s not as though there’s going to be a shock factor.”

He said this sort of administration was best handled through general taxes. Adding single fees results in “people getting upset,” he said.

“We continued to say we advocate for affordable housing and we need to undertake initiatives … to make it cheaper it to have families buy and reside in homes, and yet here we are again going to increase the costs of acquiring housing,” he said.

“A bit rich”

Yellowknife Centre MLA Julie Green said it was “a bit rich” that her colleagues were “excoriating” Sebert when the changes were already agreed upon.

“If someone can afford $500,000 for a house, they can afford an additional $350,” she said.

“I would ask my colleagues to think very carefully about putting their own self-interest ahead of the interests of the people of the NWT,” she added.

Green, along with fellow Yellowknife MLAs Caroline Cochrane and Kevin O’Reilly stood in support of the fee, which passed 15-3. The measure is contained in a bill called the Justice Administration Statutes Act, which is now awaiting a third and final reading before becoming law.

The three MLAs opposed were Vanthuyne, Testart and Tu Nedhe-Wiilide MLA Tom Beaulieu, who argued extra fees were poorly timed with dips in the housing market.




Nick Pearce

Nick Pearce is a writer and reporter in Yellowknife, looking for unique stories on the environment and people that make up the North. He's a graduate of Queen's University, where he studied Global Development...

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