BC government raises threshold for HST rebate

Finance Minister Colin Hansen announced last week that the government will raise the threshold for its maximum HST (harmonised sales tax) rebate on new homes to $525,000 from $400,000 after weeks of unrelenting pressure, debate, and lobbying. This will effectively increase the rebate by approximately 30 percent.

This means that homes under $525,000 will not have any additional taxes added when the HST is implemented next year, while homes over $525,000 will pay the 7 percent HST and be eligible for a maximum rebate of $26,250.

Thought the new threshold is above the average price of a new home in the province, it is well below the average price for a new home in most areas of the lower mainland.  An estimation by financial consultant firm Deloitte has the average price of a new detached home in Metro Vancouver at about $1.02 million.  According to Deloitte many new condo's in Vancouver communities are also above the new threshold, such as the eastside of Vancouver where the average price is now $557,000.

Though many see the government's move as a good first step, more will need to be done in this tax mitigation journey.

For more information on Vancouver housing market click here. To contact Vancouver Realtor Dean Wegman click here. 

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