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National Observer
2 days ago
- Business
- National Observer
PBO estimates tax rebate on new homes would save typical first-time buyer $27K
An eligible first-time homebuyer could save an average of $26,832 in sales tax on the price of a newly built home under Ottawa's latest housing proposal, the parliamentary budget officer said in a new report on Wednesday. But the PBO's estimate of the plan's total cost is substantially lower than the federal government's estimate, and ministers responsible for the file have not offered an explanation for the gap. In a new analysis released Wednesday, the federal fiscal watchdog predicts that 71,711 new builds would qualify for GST relief over the lifetime of the program. The proposal would see the federal portion of the sales tax eliminated on a new home worth up to $1 million if it's bought by a qualifying first-time homebuyer. The GST rebate would be phased down as the price of the home approaches $1.5 million. Homes bought from May 27 through to 2031 can qualify for the rebate, as long as construction starts before 2031 and finishes by 2036. With some exceptions, Canadians who have owned a home already are not eligible for the GST relief. Neither are investors. The PBO forecasts the program will cost $1.9 billion over six years, about $100 million lower than the estimate it presented during the spring federal election campaign. It attributes that gap to a later implementation date and a different definition used for first-time homebuyers. The federal government, meanwhile, estimated the "tax savings" for Canadians at $3.9 billion over five years when the legislation was tabled on May 27. The Liberals' spring election platform costed the GST rebate at around $1.6 billion over four years. A PBO spokesperson said in an email that any difference in figures is likely due to assumptions about the share of homes ultimately bought by first-time buyers, but deferred to Finance Canada for questions about the government's figures. Finance Minister François-Philippe Champagne did not stop for questions about the cost discrepancy on his way out of the Liberal caucus meeting Wednesday. His office did not respond to a request for clarification. Housing Minister Gregor Robertson also did not comment about the PBO report when asked Wednesday. He told reporters he would answer questions "tomorrow." A Desjardins Economics analysis of the proposal released Monday offered one explanation for the discrepancy between the PBO's cost estimate and the government's figure: Ottawa might think its program will be more popular than the PBO does. A higher cost estimate suggests more first-time homebuyers purchasing qualifying new builds, in other words. The GST rebate, which is not yet law, was included in the Liberals' spring election platform as a way to help Canadians break into the housing market. A home priced at $1 million would receive the maximum rebate of $50,000. Homes priced below that amount would still get the full rebate — but since the sales tax is a taken off a lower overall cost, the size of the rebate would be reduced accordingly. The rebate also would be lower than $50,000 for homes sold above $1 million because the rebate gradually ramps down until it zeros out at a purchase price of $1.5 million. The Desjardins report by economist Kari Norman said that if the program proves popular with first-time buyers, it could spur additional housing construction to meet higher demand. The PBO said it does not include possible behavioural responses to the program in its analysis. Norman noted in her report that it's also possible increased demand from homebuyers will push up home prices in the near-term. She estimated that 85 per cent of new homes built in Canada over the program time frame will be eligible for the full GST break of up to $50,000. In cases where the GST portion of a new home sale is rolled into the mortgage principal, the typical owner could expect to save $240 per month on mortgage payments, she said. The savings are more direct when a developer charges the GST upfront. The measure is packaged in legislation that also includes the Liberals' promised income tax cut, which is set to take effect July 1.
Yahoo
14-05-2025
- Business
- Yahoo
Finance minister says no 2025 budget, while government focuses on fall update
OTTAWA — Finance Minister François-Philippe Champagne signalled Wednesday there will be no spring budget and only a fall economic statement, despite his predecessor Dominic LeBlanc announcing pre-budget consultations earlier this year. Asked by reporters about the date of the next budget, Champagne said his first three orders of business are tabling a motion to cut the bottom income tax bracket by one per cent, presenting a speech to the throne on May 27 and then publishing an economic update in the fall. He made no mention of a budget, nor did he respond to repeated questions as to why the government would not be tabling a spring budget. 'The middle-class tax cut, that's step one. Step two, you're going to have a throne speech which will outline the Canadian government's priorities, and there will be a fall economic statement to follow,' Champagne said after the first cabinet meeting since the shuffle yesterday. Champagne's signalling that there will be no spring budget is notable because his predecessor Dominic LeBlanc announced pre-budget consultations in February. At the time, Justin Trudeau was still prime minister while the Liberal party was in the midst of a leadership race that ultimately crowned Mark Carney. 'Through Budget 2025, the government will remain focused on responding to the current Canada-U.S. context, making life more affordable for all Canadians, continuing to strengthen economic security, and unlocking growth by boosting our competitiveness and productivity,' read the release by Finance Canada announcing the consultation. In December, the Commons Finance committee also tabled a 330-page report on the fruit of its 2025 budget consultations. Wednesday, Champagne also clarified that Prime Minister Mark Carney's promise to cut the lowest income tax bracket rate by one per cent will be brought forward via a ways and means motion within the first sitting days of the House of Commons starting May 26. On Wednesday afternoon, the prime minister publicly signed an order demanding his government prepare a motion to deliver the promised tax cut during an event that emulated American-style presidential executive order signings. 'Canadians sent a clear message: they need to see improvements in their affordability,' Carney said. 'We're acting today on that so that on July 1, as promised, that middle class tax cut… will take into effect.' Champagne said he expects other Parliamentarians to 'obviously' support the government's motion. 'This is about Canadians. You know, we are in a situation, it's a dire situation,' Champagne said. 'This is a way for all parliamentarian to show up and say, 'Yes, we support Canadians at the time when they need a break'.' The last time the government did not table a spring budget was 2020 at the onset of the COVID-19 pandemic in March. At the time, the sudden shutdown of the Canadian economy laid waste to the Liberal governments' original spending plans. Instead, the Justin Trudeau-led Liberals tabled a 'mini-budget' fall economic statement. National Post cnardi@ Guilbeault throws cold water on new pipeline, says we have enough already Conservative MP says Carney should appoint a labour minister and pay more than 'lip service' to workers Get more deep-dive National Post political coverage and analysis in your inbox with the Political Hack newsletter, where Ottawa bureau chief Stuart Thomson and political analyst Tasha Kheiriddin get at what's really going on behind the scenes on Parliament Hill every Wednesday and Friday, exclusively for subscribers. Sign up here. Our website is the place for the latest breaking news, exclusive scoops, longreads and provocative commentary. Please bookmark and sign up for our politics newsletter, First Reading, here.
Calgary Herald
14-05-2025
- Business
- Calgary Herald
Finance minister says no 2025 budget, while government focuses on fall update
OTTAWA — Finance Minister François-Philippe Champagne signalled Wednesday there will be no spring budget and only a fall economic statement, despite his predecessor Dominic LeBlanc announcing pre-budget consultations earlier this year. Article content Article content Asked by reporters about the date of the next budget, Champagne said his first three orders of business are tabling a motion to cut the bottom income tax bracket by one per cent, presenting a speech to the throne on May 27 and then publishing an economic update in the fall. Article content Article content He made no mention of a budget, nor did he respond to repeated questions as to why the government would not be tabling a spring budget. Article content Article content 'The middle-class tax cut, that's step one. Step two, you're going to have a throne speech which will outline the Canadian government's priorities, and there will be a fall economic statement to follow,' Champagne said after the first cabinet meeting since the shuffle yesterday. Article content Champagne's signalling that there will be no spring budget is notable because his predecessor Dominic LeBlanc announced pre-budget consultations in February. At the time, Justin Trudeau was still prime minister while the Liberal party was in the midst of a leadership race that ultimately crowned Mark Carney. Article content 'Through Budget 2025, the government will remain focused on responding to the current Canada-U.S. context, making life more affordable for all Canadians, continuing to strengthen economic security, and unlocking growth by boosting our competitiveness and productivity,' read the release by Finance Canada announcing the consultation. Article content Article content In December, the Commons Finance committee also tabled a 330-page report on the fruit of its 2025 budget consultations. Article content Article content Wednesday, Champagne also clarified that Prime Minister Mark Carney's promise to cut the lowest income tax bracket rate by one per cent will be brought forward via a ways and means motion within the first sitting days of the House of Commons starting May 26. Article content On Wednesday afternoon, the prime minister publicly signed an order demanding his government prepare a motion to deliver the promised tax cut during an event that emulated American-style presidential executive order signings. Article content 'Canadians sent a clear message: they need to see improvements in their affordability,' Carney said. 'We're acting today on that so that on July 1, as promised, that middle class tax cut… will take into effect.' Article content 'This is about Canadians. You know, we are in a situation, it's a dire situation,' Champagne said. 'This is a way for all parliamentarian to show up and say, 'Yes, we support Canadians at the time when they need a break'.'
Economic Times
22-04-2025
- Business
- Economic Times
Final carbon rebate arrives as fuel levy ends, leaving billions unaccounted for
Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Canadian taxpayers are receiving their final Canada Carbon Rebate today (April 22 2025). The payout is being sent as the federal carbon tax on fuel (federal carbon tax levied on the carbon content of fossil fuels, particularly gasoline and diesel, at the pump) officially ended on April 1 carbon tax was designed to generate revenue for Canada 's economy.A significant portion (around 90%) of the revenue generated from the fuel tax was intended to be returned to households through the Canada Carbon was designed to offset the increased costs for individuals, particularly low- and middle-income families, with the government stating that most households would receive more back in rebates than they paid in the of April 1, 2025, the federal carbon tax on fuel was eliminated. This means that consumers no longer pay this additional charge at the the fuel tax has ended, the final rebate isn't being funded by current fuel tax revenue. It's essentially a payout of previously collected funds or a direct government "unique economic scenario" distributes money that isn't being directly recouped from the mechanism that was initially designed to fund Green Party's co-Leader, Jonathan Pedneault, while acknowledging Canadians' "entitlement" to the payment, pointed out the politically sensitive timing, labeling it a potential "Liberal gift" ahead of the the quarterly rebates were initially funded by carbon tax revenues, this final installment effectively operates as a government transfer, as no new fuel charges are being collected to cover it. Finance Canada has remained tight-lipped regarding the total cost of this final payout, declining repeated requests from a Canadian news outlet, CBC News, for the end of the fuel levy, a Finance Canada spokesperson justified the continued payment as an "affordability measure," stating that Canadian families, particularly those with lower incomes, were relying on this April the overall cost of this final rebate remains undisclosed, Finance Canada has released the specific amounts eligible adults will receive across participating range from $110 in Prince Edward Island and Nova Scotia to $228 in Alberta, with a 20 per cent rural supplement for eligible businesses that qualified for the Canada Carbon Rebate will still receive their reimbursements for carbon tax paid over the past year, with Finance Canada outlining plans to return $623.1 million in proceeds for the 2024-25 fuel charge year.
Time of India
22-04-2025
- Business
- Time of India
Final carbon rebate arrives as fuel levy ends, leaving billions unaccounted for
Canadian taxpayers are receiving their final Canada Carbon Rebate today (April 22 2025). The payout is being sent as the federal carbon tax on fuel (federal carbon tax levied on the carbon content of fossil fuels, particularly gasoline and diesel, at the pump) officially ended on April 1 2025. The carbon tax was designed to generate revenue for Canada's economy. A significant portion (around 90%) of the revenue generated from the fuel tax was intended to be returned to households through the Canada Carbon Rebate. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Neurologist: 9 Out of 10 People with Neuropathy Overlook This Key Insight Nerve Relief Read More Undo This was designed to offset the increased costs for individuals, particularly low- and middle-income families, with the government stating that most households would receive more back in rebates than they paid in the tax. As of April 1, 2025, the federal carbon tax on fuel was eliminated. This means that consumers no longer pay this additional charge at the pump. Live Events Because the fuel tax has ended, the final rebate isn't being funded by current fuel tax revenue. It's essentially a payout of previously collected funds or a direct government transfer. This "unique economic scenario" distributes money that isn't being directly recouped from the mechanism that was initially designed to fund it. The Green Party's co-Leader, Jonathan Pedneault, while acknowledging Canadians' "entitlement" to the payment, pointed out the politically sensitive timing, labeling it a potential "Liberal gift" ahead of the election. While the quarterly rebates were initially funded by carbon tax revenues, this final installment effectively operates as a government transfer, as no new fuel charges are being collected to cover it. Finance Canada has remained tight-lipped regarding the total cost of this final payout, declining repeated requests from a Canadian news outlet, CBC News, for disclosure. Despite the end of the fuel levy, a Finance Canada spokesperson justified the continued payment as an "affordability measure," stating that Canadian families, particularly those with lower incomes, were relying on this April rebate. While the overall cost of this final rebate remains undisclosed, Finance Canada has released the specific amounts eligible adults will receive across participating provinces. These range from $110 in Prince Edward Island and Nova Scotia to $228 in Alberta, with a 20 per cent rural supplement for eligible recipients. Small businesses that qualified for the Canada Carbon Rebate will still receive their reimbursements for carbon tax paid over the past year, with Finance Canada outlining plans to return $623.1 million in proceeds for the 2024-25 fuel charge year.
