TorontoThe Ontario government is proposing to help first-time homebuyers by lowering costs with a sales tax rebate it says could save up to $130,000, when combined with other provincial and federal saving initiatives. Federal government proposed to remove 5% of HST for first-time buyers in JuneArrthy Thayaparan · CBC News · Posted: Oct 28, 2025 1:56 PM EDT | Last Updated: 1 hour agoListen to this articleEstimated 4 minutesOntario plans to rebate provincial portion of HST for first-time home buyers The Ontario government announced it will eliminate the provincial portion of HST for some first-time home buyers. CBC’s Clara Pasieka breaks down the details. The Ontario government is proposing to help first-time homebuyers by lowering costs with a sales tax rebate it says could save up to $130,000, when combined with other provincial and federal saving initiatives. The proposal, which will be included in next week’s fall economic statement, will rebate the eight per cent provincial harmonized sales tax (HST) for first-time buyers purchasing a home valued up to $1 million. It comes after Ontario promised to follow suit if the federal government removed its portion of the HST for first-time homebuyers, which was proposed in June. The provincial tax relief will help buyers manage financial challenges in a time where “every dollar counts,” said Ontario Finance Minister Peter Bethlenfalvy at a news conference announcing the proposal Tuesday. “In short, it means more money that stays where it belongs, in the pockets of hard working Ontario families,” he said. “Through measures like this HST relief, we’re helping more young families take that first step into home ownership.”The provincial initiative combined with existing Ontario reliefs, such as the HST New Housing Rebate, would save first-time buyers up to $80,000 off the cost of a new home, said a news release from the province. It said all provincial savings paired with the federal government’s plan to eliminate 5 per cent of the HST for homes valued up to $1 million would equal $130,000 in total savings for first-time homebuyers. WATCH | Is it time for first-time homebuyers to take a leap?:First-time home buyers: Is now the time to buy?Lower prices and cooling interest rates have first-time home buyers in parts of Canada wondering if this is their shot to own. For The National, CBC’s Ashley Fraser breaks down what’s happening in the real estate market and the costs to consider before diving in.While homes valued up to $1 million would qualify for the full rebate, there will be partial rebates on a phased-in basis for homes valued up to $1.5 million. The rebate is “tremendous news” for first-time homebuyers and home builders across the province, said Ontario Housing Minister Rob Flack at the news conference Tuesday. “Uncertainty has led builders and buyers to hit the pause button. Subject to federal legislation, they will soon be able to take their finger off that pause button,” he said. “Our mission is simple. We want to get homes built, we want to keep workers on the job, and we want to keep the dream of home ownership alive.”Implementation of the rebate is subject to the passing of federal legislation, said the province, adding the tax relief will be available for homes purchased on or before May 27, 2025 and before 2031. Homes under construction will need to begin before 2031 and be “substantially completed before 2036,” it said.WATCH | Ontario once again fails to meet its housing starts goal:Ontario is far off its housing starts goalUpdated numbers show the Ontario government once again failed to meet its goal for housing starts, even with new ways of counting them. CBC’s Lorenda Reddekopp has the details — and reaction. Tax relief could provide reprieve to home buildersAt a recent housing summit sponsored by the Residential Construction Council of Ontario (RESCON), construction industry experts, professionals and stakeholders indicated that the heavy tax burden is one of the main hurdles in the way of new home construction. The potential tax relief will help people “who have been priced out of the market,” said RESCON president Richard Lyall.“First-time buyers account for roughly 35 per cent of new home purchases but they have been particularly hard hit, given the housing-cost-to-income-ratio which, in recent years, has moved beyond historic averages,” Lyall said. “This initiative will help to prevent younger talent and families from leaving the Greater Toronto Area and the province.”Lyall says the residential construction industry is “grim” right now — with housing starts in Toronto at a 30-year low and “sales ground to a halt.”“We are in the worst housing crisis in a generation, and these unprecedented times require bold, innovative solutions,” said Lyall, adding RESCON will continue to monitor the impact of the new measures. ABOUT THE AUTHORArrthy Thayaparan is a Toronto-based multimedia journalist. She’s interested in health, climate and community stories. She has previously worked at Reuters and CBC Vancouver. You can contact her at arrthy.thayaparan@cbc.ca. With files from the Canadian Press and Globe Newswire
Ontario government proposes tax relief for some first-time homebuyers
