Advocates praise GST removal for new apartment builds but want provinces and cities to follow suit

Among the measures was a long-standing election campaign promise to eliminate the GST on new apartment builds to help with rising housing costs.

The measure would lower the cost of labour and materials for homebuilders, and Trudeau said he hopes other provinces follow Ontario’s recent announcement that they will remove their own sales taxes on the cost of building new rental homes too.

The Canadian Taxpayers Federation has joined those calls, calling for the Sask. Party government to axe the PST on new builds, which has been in place since 2017.

Gage Haubrich is the prairie director for the Taxpayers Federation and said the organization has been calling for this move since it was introduced.

“When they did it in 2017, it wasn’t a good idea and housing has only gotten more expensive since then,” he said. “The premier has recently said he wants to take action on housing affordability and an easy way to do that is to stop driving up the cost by charging the PST on housing construction.”

The Taxpayers Federation quoted data from the 2021 Census which showed that over one in six households spent 30 per cent or more of their total household income on shelter costs (17.2 per cent), which is less than the national ratio of 20.9 per cent and the fifth highest among provinces.

(Saskatchewan Bureau of Statistics)

“When a family sits down and looks at their budgets, one of the biggest line items on that is their housing costs,” Haubrich added.

The Canadian Home Builders’ Association is another group that, for years, has advocated for taxation reform on purpose-built rentals. They, as well, are calling for provincial governments to follow suit and remove their sales on these projects. They’re also calling for municipalities to reduce their development taxes and levies on new home builds.

That call for action is echoed by the Prince Albert Construction Association and President Dan Yungwirth.

“Besides the GST and PST, we would be looking for municipalities to kick in as well and reduce and eliminate those development levies,” he said. “We are at a crisis level and most people cannot afford housing to the level that they could have five or 10 years ago. We really got to dig deep and find ways to reduce those costs.”

Yungwirth and the Construction Association say they have been advocating for those changes for years adding that construction costs continue to rise and while material costs are fixed, governments have the authority to reduce other costs.

In February, the Saskatchewan Urban Municipalities Association (SUMA) called for the PST to be exempt from construction projects, arguing the province isn’t paying its fair share of revenue back to the municipalities.

In response, the province said the PST helps pay for everything from health care to education and protective services and they have significantly raised the amount of money in revenue sharing that municipalities receive.

In response to the municipal development levies, SUMA told paNOW that those levies are not money-makers and address immediate and ongoing costs for infrastructure.

In a statement, SUMA added that “municipalities can, and do, often provide exemptions or reductions for either property taxes generally, or development fees specifically, for affordable housing, or high-density housing.”

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panews@pattisonmedia.com

by paNOW Staff

Advocates praise GST removal for new apartment builds but want provinces and cities to follow suit

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