Ontario proposes to rebate HST for some first-time homebuyers

New homes are constructed in Ottawa on Monday, Aug. 14, 2023. THE CANADIAN PRESS/Sean Kilpatrick

TORONTO — TORONTO — Some first-time homebuyers in Ontario could soon save tens of thousands of dollars on the cost of a home under a proposal from the provincial government to rebate the HST, but opposition leaders say it is too "unambitious" amid a housing crisis.

The Ontario government had previously signalled that if the federal government removed its portion of the harmonized sales tax for first-time homebuyers, the province would follow suit, and Finance Minister Peter Bethlenfalvy made the announcement Tuesday.

"Today, we're taking steps to continue making life more affordable and to restore the dream of home ownership for more families by working with the federal government to mirror their proposed HST/GST first-time homebuyers rebate," he said.

"In short, it means more money that stays where it belongs, in the pockets of hard-working Ontario families."

The federal government proposed earlier this year to rebate the federal portion of the HST on new and substantially renovated homes valued up to $1 million for first-time homebuyers. Ontario's provincial rebate will be in next week's fall economic statement, Bethlenfalvy said. About $500 million over three years is being allocated to the rebate, he said.

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.

Green Party Leader Mike Schreiner said homes up to $1.5 million should qualify for the full rebate, so home buyers in Toronto and the surrounding area, where housing tends to be more expensive, can benefit.

"(It's) just unambitious," he said of the announcement. "We're in the worst housing crisis in Ontario history. Ontario has the worst housing crisis in the entire country and instead of legalizing multiplexes and mid-rises, taking development charges off of housing and land transfer taxes...this government's tinkering around the edges."

Municipal Affairs and Housing Minister Rob Flack said there are many homes available for under $1 million for people to be able to take advantage of the rebate.

"There are some throughout the province – maybe not always in the GTA, but outside of Toronto," he said after question period.

"There are in my home community ... you can buy homes in St. Thomas for $650,000, beautiful new homes."

Liberal housing critic Adil Shamji said the government should have done as his party proposed earlier this year, to introduce an HST rebate for all new primary residence purchases, not just for first-time homebuyers.

"Housing has become wildly unaffordable, and so what we needed to hear today was a solution that is as bold as the crisis is deep," he said.

"We didn't get that. We got a half-hearted measure that is too little too late."

Ontario is behind its goals on housing starts and Flack has started backing away from Premier Doug Ford's once much-touted target of building 1.5 million homes over 10 years.

Ontario's final tally for housing starts in 2024 was well off what's needed to achieve 1.5 million homes, even with various new categories the government is adding such as university dorms, and the financial accountability officer says housing starts for the first quarter of 2025 were at the lowest levels since 2009.

NDP Leader Marit Stiles said there aren't many new homes for new homebuyers to purchase.

"The government has given up on their commitment completely to build 1.5 million homes," she said. "They don't even want to talk about any kind of targets."

This report by The Canadian Press was first published Oct. 28, 2025.

Allison Jones, The Canadian Press