Ontario moves to scrap HST on new homes in one-year push

Ontario homebuyers are set to see a rare tax break on new construction, with the province proposing to remove the full 13% Harmonized Sales Tax (HST) on eligible new homes for one year in partnership with Ottawa.

The measure, to be detailed in the March 26, 2026 budget, targets new homes up to $1 million and offers scaled relief up to $1.85 million.

Under the plan, buyers of new homes valued up to $1 million will receive a maximum rebate of $130,000, covering both the provincial and federal portions of HST.

That full $130,000 will maintain up to $1.5 million, then phase down to $24,000 for homes priced at $1.85 million and above. The program is slated to run from April 1, 2026 to March 31, 2027, with construction timelines extending to as late as 2031 in some cases.

“In the face of tariffs and economic uncertainty, our government is working closely with the federal government to do everything we can to lower costs for families, keep workers on the job and build the most competitive, resilient and self-reliant economy in the G7,” Premier Doug Ford said.

“Today’s announcement will provide meaningful and significant relief to the people of Ontario, helping thousands more families realize the dream of homeownership and boosting Ontario’s economy by $2.7 billion.”

Government officials estimate the expanded rebate could stimulate an additional 8,000 housing starts, support up to 21,000 jobs and deliver about $2.2 billion in joint tax relief.

“Ontarians have seen costs increase as a result of ongoing economic uncertainty, so it is more important than ever that we continue to keep costs down to make life more affordable for families and individuals,” Peter Bethlenfalvy, Ontario’s finance minister, said.

“With this enhancement and expansion of the HST rebates, we are supporting home affordability while providing relief to hardworking Ontario families on one of the biggest financial transactions of their lives.”

Local officials framed the move as one piece of a broader affordability response, especially in high-growth markets such as Mississauga.

“As a city, we welcome this important step to make homes more affordable,” Mississauga mayor Carolyn Parrish said.

“The provincial government’s HST cut would help turn Mississaugans’ homeownership dreams into reality.”

CMP

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