Source: The Toronto Star)
Industry employs as many as the auto sector, builders say
They’re mad as hell and don’t want to take it any more. Ontario new home builders, reeling from the economic downturn, shaky consumer confidence and steep municipal development charges, are furious with the Ontario Liberal government’s plan to blend the goods and services tax (GST) with the provincial sales tax.
The outrage was evident Tuesday at an Ontario Home Builders’ Association forum. During a session intended to offer insight into surviving in uncertain times, the hot topic was the harmonized sales tax (HST). The move would add 2 per cent more in taxes to houses under $400,000 and 8 per cent to houses of $500,000 or more. The new tax takes effect July 1, 2010. Only GST (5 per cent) is charged on new homes currently. Although the HST rate would be 13 per cent, Ontario has proposed a rebate of 75 percent of the province’s portion of the HST (6 per cent) for new homes sold for under $400,000.The rebate would be reduced incrementally after $400,000 and at $500,000 no rebate would apply.
A buyer of a $400,000 house will pay $8,000 more in taxes, while the buyer of a $500,000 house will pay a whopping $40,000, pointed out Brian Johnston, Monarch Corp.” For an extra $100,000, a homeowner is paying $32,000 more in taxes,” said Johnston. In the Greater Toronto Area (GTA), he added, the average price of a new lowrise home is $480,000. “This is a bad deal for us. This is a tax grab,” said Hugh Heron of Heathwood Homes. “Taxation on houses goes on forever. There is no way this should go forward.”
Read Tracy Hane’s full article “Home builders slam harmonized tax plan” in the Toronto Star (April 4 2009)