Today the McGuinty government announced enhancements to the single sales tax rebate on new homes, which is a part of its comprehensive tax reform package.
New home buyers will now qualify for a 75% rebate on the provincial portion of the single sales tax on the first $400,000 – regardless of the total new home price. As a result, buyers of new homes will receive greater benefit from reduced residential construction costs.
In addition, the government announced measures to improve the outcome of a single sale tax on renters as well as key rules to determine which transactions will be subject to the single sales tax during this transitional period leading up to July 1st, 2010. Today’s announcement is “welcomed news to home buyers and renters across the province”, according to the Building Industry and Land Development Association and the Ontario Home Builder’s Association.
“We commend the government for utilizing the tools at its disposal, to address the unique challenges of the housing sector, as it relates to the new single sales tax in Ontario,” says Len Crispino, President & CEO of the Ontario Chamber of Commerce. “The treatment of new housing announced today, will help to ensure Ontario reaps the benefits of a value-added tax on consumption, while mitigating the impacts on consumers in this large single one-time purchase. In addition, the input tax credits on the construction of a new home will further reduce the net costs of new housing in Ontario. This decision only strengthens the inherent value of a single sales tax in Ontario.”
The government’s announcement can be found here.
