First, this has got nothing to do with ICBC other than ICBC administers vehicle transfers and collects the tax. The Ministry of finance for BC sets the tax and the regulations.
Second, no it's not corrupt, at least not on the face of it. The bigger question is it fair or equitable. At least in the sense the regulation is set so that people who buy cars in private sales can't escape taxes that people who buy at a public retailer have to pay it's fair. Is it fair to the guy who paid more than the 'average' price' for that vehicle. Since he bought the car I guess it is fair. He wanted the car more than the average buyer.