Iqaluit city council looks to tax vacant residences
Council to discuss plan Tuesday, following unanimous support from finance committee
Iqaluit city councillors are looking to tax vacant properties in the city, with an aim to free up more rental units.
City council is scheduled to discuss the proposal on Tuesday, after the city’s finance committee unanimously approved a motion last week that recommends creating a new bylaw to allow for the tax.
The amount has yet to be determined, but a key feature of the proposed vacancy tax bylaw would be allowing the owner of a building to pass the tax on to a renter.
Iqaluit Mayor Kenny Bell said he hopes this creates an incentive to fill vacancies.
The majority of properties, especially buildings, in Iqaluit are leased by the Government of Nunavut, chief administrative officer Amy Elgersma said to the committee.
Coun. Romeyn Stevenson said small businesses and individuals are pushed out of the housing market by the government, which has the financial flexibility to pay high prices to lease units and keep them vacant. Funding the government receives in the form of subsidies, he said, contributes to that financial flexibility.
“I think Mayor Bell was quite correct that the cost [of the vacancy tax] will get passed on and it should get passed on to those renters like the [Government of Nunavut],” Stevenson said.
He added that vacant, yet owned or leased, properties has been identified as a key factor in Iqaluit housing crisis by the city’s housing task force.
Kyle Sheppard, the chairperson of the finance committee, said he doesn’t know exactly how many properties leased by the Government of Nunavut are vacant or how many homes are vacant because they are in poor condition, but through anecdotes from landlords he’s heard it’s “a significant number.”
“We need to put families into housing in our community, we can’t afford to have these units sitting vacant,” he said.
The bylaw is still in its early stages, so Sheppard isn’t able to say how individuals or small business owners would be protected from property owners passing the new tax down to them. He added once the motion is passed and work on policy begins those specifics would become clearer.
“Ultimately, the goal is to have as many units occupied as possible in hopes that a vacancy tax is never payable by any party,” he said.
According to a 2020 report from the Canada Mortgage and Housing Corp., 0.2 per cent of Iqaluit’s housing is vacant and available to be rented.
The same report stated the average cost of rent in Iqaluit is $2,736, more than double that of Whitehorse. Meanwhile, the Nunavut Housing Corporation estimated last year that an additional 360 units are needed in Iqaluit.
If council approves the proposal, Sheppard said the intent is to have a vacancy tax policy in place by the end of the year.