Ontario Supports More Homebuyers
McGuinty Government Proposes Measures for New Housing
The McGuinty government is proposing measures that would build on the comprehensive tax package announced in the 2009 Ontario Budget:
- Enhanced new housing rebate - The province would enhance the new housing rebate so that new homes across all price ranges would receive a 75 per cent rebate of the provincial portion of the single sales tax on the first $400,000. For new homes under $400,000, this would mean, on average, no additional tax amount compared to the current system.
- New rental housing rebate - Similar to the enhanced new housing rebate, the province is proposing a rebate for new residential rental properties. This proposed rebate would support affordable rental housing across Ontario.
- Transitional rules - The province is also proposing transitional rules for new housing. Generally, as part of the transitional rules, sales of new homes under written agreements of purchase and sale entered into on or before June 18, 2009 would not be subject to the provincial portion of the single sales tax, even if both ownership and possession are transferred on or after July 1, 2010. The tax would also not apply to sales of new homes under written agreements of purchase and sale entered into after June 18, 2009 where ownership or possession is transferred before July 1, 2010.
- By providing a rebate of up to $24,000 for new homes across all price ranges, Ontario would be enhancing what would already be the most generous rebate of its kind in Canada.
- 75 per cent of new homes sold in Ontario are under $400,000 and would not be subject to an additional tax amount, on average, compared to the current retail sales tax (RST) embedded in the price of new homes.
- 93 per cent of all homes sold in Ontario, on average, would not be subject to an additional tax amount under the proposed single sales tax.
- Taken together, the new housing rebate and the transitional rules would keep the new housing sector fiscally neutral over the transitional period, relative to the amount of RST currently embedded in the price of new homes.
- As part of the comprehensive tax package, the province would also provide, over three years, $10.6 billion in direct payments and permanent tax relief for the people of Ontario and $4.5 billion in tax relief for businesses.
“During these challenging economic times, the McGuinty government's enhanced housing rebate would improve affordability for more homebuyers - increasing the most generous housing rebate of its kind in Canada”
“Our comprehensive tax package is critical in making Ontario's businesses more competitive, and supports Ontario's housing sector by creating more jobs and a strong, growing economy”