Will Ontario introduce their version of the Home Renovation Tax Credit?
Ottawa's Home Renovation Tax Credit, in 2009, pumped $4.3-billion of extra work into our industry. Now, a similar idea for Ontario has at least reached the conversation stage.
By Alec Caldwell
How about a Home Renovation Tax Credit for Ontario? Well, at least it’s been talked about. Whether we will ever see it, is another matter.
During MPP Mike Colle’s Residential Renovation Round Table at Queen’s Park on Dec. 5, the idea of a provincial Home Renovation Tax Credit for Ontarians was given a lot of discussion. I was part of them, on behalf of our members at CARAHS.
Such a tax credit would, of course, help to level the playing field for above board contractors. To qualify for the tax credit, projects would have to be registered and this would be a serious incentive for homeowners to avoid cash deals.
Under-the-table renovation is a multi-billion dollar industry. In a 2010 Environics survey of 1,113 Ontario homeowners, 56% admitted to paying cash for home repairs and renovation work. 68% said they would be less likely to pay cash if they receive some kind of tax credit.
And the stimulus our industry would be given, under such a tax credit, would be very important to the economy of Canada’s largest province. In 2013, renovations and construction in Ontario supported nearly 200,000 people (not including the cash guys). Home renovations by contractors accounted for $14 billion. Another $9.3-billion was spent by do-it-yourselfers. So home improvement, in Ontario, was a $23.3-billion in industry in 2013. It’s an important sector to protect. It’s a massive job creator, and one of the biggest tax-avoiding industries there is – if not THE biggest.
The Federal Government’s Home Renovation Tax Credit (HRTC) helped many contractors and tradesmen survive through a tough period in 2009 and it supported the Canadian economy when the world was crashing around other country’s ears. Ottawa reckoned it pumped $4.3 billion dollars into the home renovation industry.
It could work provincially. The province seriously needs the foregone tax revenue. Our industry could use the stimulus. Let’s hope the discussion at Mike Colle’s round table can lead somewhere.
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