Leading commercial real estate organizations are calling for the B.C. government to scrap its planned expansion of the Provincial Sales Tax to include a broad range of professional services.

Along with other diverse industry groups, the CRE organizaitons warn that the P.S.T. expansion will drive up real estate costs, discourage investment and undermine development across the province.

The call comes in response to Budget 2026, which also confirmed a planned $80 billion increase in provincial debt over three years and a record $13.3-billion deficit for 2026–27.

The newly announced changes would apply the 7% P.S.T. broadly to professional services, including accounting, engineering, architectural, security and commercial real estate services, with a partial 30% tax base applied to architectural, engineering and geoscience work.

The Building Owners and Management Association, CBRE, British Columbia Real Estate Association, NAIOP Vancouver and the Urban Development Institute were among the groups that signed a joint statement, released Tuesday, calling for the province not to increase the tax burden.

“B.C. cannot afford policies that raise input costs, discourage investment, and weaken our competitive position,” said the joint statement. “B.C.’s P.S.T. is already the most uncompetitive sales tax in Canada, and Budget 2026 doubles down. This expansion creates a massive new administrative burden and a ‘tax on a tax’ for every project.”

The groups said the measures would directly affect property owners and tenants.

“Taxing property management and leasing services will effectively hike rent for every local retailer and making it even harder for downtown storefronts to keep their lights on.”

They also criticized the inclusion of security services in the tax expansion.

“While the government says they want safe streets, they are taxing security services and punishing small businesses for trying to protect their stores from theft and vandalism. Public safety concerns have driven many businesses to hire additional security to operate safely, and this ill-advised change effectively penalizes them for trying to manage a challenge they did not create.”

On housing and development, the signatories said the changes contradict government pledges to accelerate construction and major projects.

“Instead of following through with their promises to accelerate housing construction and meet their own targets, the government, through Budget 2026 is choosing to raise the cost of homebuilding. Taxing the essential services needed to build homes, including the new levy on architectural and engineering work, is a direct hit to affordability and project viability. It could not come at a worse time as housing projects are being shelved and cancelled all across B.C. as market conditions deteriorate.”

The groups also contend that the province is adding to the cost of major projects when it is seeking to accelerate them, putting investment, jobs and trade-diversification goals at risk.

“We urge the government to scrap these P.S.T. changes,” said the groups. “British Columbia is facing an uncertain future, and we cannot tax our way to prosperity by targeting the essential services that build our homes, protect our streets, and grow our economy.”

The joint statement’s other signatories include mining and engineering groups, the Business Council of B.C., the BC Council of Forest Products, the Canadian Federation of Independent Business, the B.C. Chamber of Commerce, the Greater Vancouver and Surrey & White Rock Boards of Trade, the Retail Council of Canada and the Save Our Streets Coalition.