OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government - 16
10. Improve home affordability by eliminating the HST on new construction home purchases
The Harmonized Sales Tax (HST) was introduced in Ontario on July 1, 2010, combining the federal Goods and Services Tax (GST) with
provincial sales tax (PST) into a single tax. In this same year and recognizing the harmful effect of large HST bills on new home purchase
affordability, the Ontario Government implemented a cap of 75% of the 8% of the provincial portion of HST up to a maximum of $24,000.
This cap has not been increased ever since, lacking a true reflection of current construction costs and inflation.
With the higher costs, significantly tightened regulatory lending requirements and employment uncertainty, home affordability is
increasingly beyond the reach of today's families, especially in major urban centres. A large reason for this affordability crisis is the
significance of HST costs that increasingly are born by the purchaser without rebate. This reality has been heightened by the current
COVID-19 pandemic.
Design and construction of new multifamily and residential construction is desperately needed in Ontario. The residential construction
industry contributes over $51 billion dollars to Ontario's economy, employing more than 330,000 people across the province. Engineers
are required to undertake small and large residential projects, leading innovation, and incorporating latest technologies. This work
employs significant numbers of engineers of all disciplines but cannot start unless there are qualified home buyers that can afford the
ultimate product.
Elimination of the HST on newly constructed residential purchases for owner-occupiers is long overdue and will jump-start an important
sector of the economy while satisfying a vital public need for affordable housing.
16
OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government
Table of Contents for the Digital Edition of OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government
OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government - Cover1
OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government - 1
OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government - 2
OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government - 3
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OSPE - COVID-19 Economic Recovery Recommendations - Provincial Government - Cover4
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