Ontario Unveils New HST Rebate to Help First-Time Homebuyers Enter the Market
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The provincial government of Ontario recently announced a new tax-relief measure aimed at making home-ownership more accessible to first-time buyers. Under the plan, eligible first-time purchasers of new homes will receive a rebate on the provincial portion of the 13 per cent harmonized sales tax (HST) — effectively eliminating that tax bill for homes valued up to $1 million. For homes priced between $1 million and $1.5 million, the rebate will gradually phase-out, and no rebate will apply at or above the $1.5 million threshold.
The rebate is designed to work alongside the existing federal incentives for first-time home buyers, thereby amplifying overall savings and lowering the entry barrier into the housing market. The announcement comes in the context of rising home-prices and affordability pressures in the Greater Toronto Area and across Ontario. Public commentary suggests this could be a meaningful boost for younger buyers or families who are trying to make the jump into owning instead of renting.
However, the benefit is limited in several ways: it only applies to the provincial portion of HST (not necessarily the full GST/HST liability), it only applies to newly-built or substantially renovated homes (depending on the final legislation), and the phase-out for homes priced above $1 million means many would still face significant tax costs. Also, as with many programs of this nature, precise eligibility criteria and timing (such as date of purchase, builder agreements, and occupancy) will matter. Buyers should therefore read the fine print or seek advice to ensure they qualify.
Read the full article on: CBC
