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PBO Forecasts $1.9 Billion Cost for First-Time Homebuyer GST Rebate

Passed first reading, the legislation will wipe out federal sales tax on new homes up to $1.5 million to boost affordability.

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New home construction.

Overview

  • The parliamentary budget officer projects the rebate will cost $1.9 billion over six years, covering full GST refunds on new homes under $1 million and partial relief up to $1.5 million.
  • Roughly 71,711 qualifying first-time buyers are expected to claim the rebate, with an average subsidy of $26,832 per purchase.
  • Eligibility extends to homes bought from May 27, 2025 through 2031, provided construction starts before 2031 and finishes by 2036.
  • Bill C-4, which encompasses the GST rebate and a promised income tax cut, has cleared its first reading in the House of Commons.
  • The government’s own estimate of $3.9 billion in tax savings over five years exceeds the PBO’s figure, reflecting different assumptions about program uptake.