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British Columbia's Finance Minister, Colin Hansen. (Jonathan Hayward)
British Columbia's Finance Minister, Colin Hansen. (Jonathan Hayward)

B.C. vows bigger HST break for new home buyers Add to ...

Bowing to pressure from home builders, the British Columbia government is promising to provide a bigger break on the new harmonized sales tax to new home buyers.

The province announced earlier this year that B.C. will move to the HST next July, combining the five per cent GST with the province's seven per cent sales tax.

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Read the B.C. government's statement

But home builders argued the tax would stifle new home sales at a time when the market is still reeling from the recession.

Finance Minister Colin Hansen, who earlier this week said he could not follow Ontario's lead in offering new breaks on the HST, said today in a statement: "We heard the concerns from consumers and industry about how the HST might affect home buyers."

The threshold will rise to $525,000, instead of the $400,000 that was initially proposed.

It means that on average, purchasers of new homes up to $525,000 pay no more tax than they would under the current tax regime.

The shift to the HST in B.C. caused a political firestorm because the B.C. Liberal party stated during the spring election campaign it was not planning to adopt the tax. After the election, in the face of collapsing revenues, Mr. Hansen said he decided B.C. would benefit from the shift, which will bring $1.6-billion in transfers from the federal government.

Follow on Twitter: @justine_hunter

 

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