Poilievre calls on premiers to remove sales taxes on new homes under $1M

Conservative Leader Pierre Poilievre is calling on Canada's premiers to match his pledge to remove the federal sales tax on new homes under $1 million by doing the same with provincial sales taxes.

"This is a significant step in fixing what has been broken and making home ownership more than just a dream for young Canadians again,"Poilievresaidin a letter to all provincial and territorial premiers, which was shared with CBC News.

"But there's more that can be done, and you can help."

Poilievre sent the letter on Sunday. It came one week after he promised a government led by him would remove the GST from the purchase of entry-level new homes. He argued the tax was not intended to apply to necessities like food and housing, and that removing the GST would spur more housing starts.

The Conservatives say the move would save Canadians $40,000 on a $800,000 house and would drive the construction of an additional 30,000 homes in Canada every year. The announcement was praisedby the CEO of the Canadian Home Builders' Association.

In his letter to premiers, Poilievre asked them to match his proposal "by axing the provincial sales tax (where applicable) on new homes under $1 million."

Alberta and the territories do not have a provincial sales tax. Provincial sales tax rates range from six per cent in Saskatchewan to 10 per centin the Atlantic provinces. British Columbia doesn't charge provincial tax on new homes.

The cost of housing has been an issue across the country; experts have blameda surging population, higher interest rates and insufficient housing supply for the shortage of affordable housing. Canadian house priceshave increased by an average of more than 30 per cent since April 2020.

"I understand that all provinces are different. But if you match my announcement with a provincial sales tax cut of your own on new homes, you will save your residents tens of thousands of dollars," Poilievre wrote in the letter.

Premiers brush off the idea

In Nova Scotia, where an election campaign is underway, Houston has promised to create a new financing optionfor first-time buyersbut has been non-committal about lifting provincial tax from new builds.

"I'm interested in lower taxes," Houston said Monday, pointing to his plans to lower income taxes and the HST."I'll talk to anyone about any ideas they haveon lower taxes and more housing, I'm happy to have a discussion about that. It's not something I can commit to today."

When asked about Poilievre's tax cut proposal, aspokesperson for Quebec Premier Franois Legault referred back to comments made by the province's finance minister,ric Girard,last week.

Girardsaid he looked at the proposal and concluded that it would not be "a particularly effective measure."

In media statements, officials in Ontario and Saskatchewan also declined to commit to fully removing provincial sales taxesfrom new home builds.

Both provinces already have programs that offer partial rebates on the provincial portion of the sales tax for new homes.

"Any changes to taxation would have to be considered as part of the budgetary process," said Julie Leggott, press secretary to Saskatchewan Premier Scott Moe, in a media statement.

A spokesperson for the government of Prince Edward Island said the province is open to the idea but it "would need thorough review to assess what the impact and cost to the province would be."

WATCH |Poilievre pledges to remove GST on new homes under $1M:

Poilievre pledges to remove GST on new homes under $1M

10 days ago

Duration 2:06

Conservative Party Leader Pierre Poilievre announced a plan to remove the GST from new-construction homes under $1 million, if his party forms government.

Cutting the tax would comewith significant costs.

Poilievre has said he would cover the cost of cutting the GST which he estimates at about $8 billion annually by cutting federal programs he calls bureaucratic, including the Housing Accelerator Fund.

Liberals fireback

Federal Employment Minister Randy Boissonnault called Poilievre's letter to the premiers "reckless" and decried his plan to cut existing housing programs to fund his proposed tax cut.

"It's really bad," Boissonnault said Monday. "Earlier he was talking about getting rid of gatekeepers. So what did we do? We went and said to the municipalities, 'Speed up your zoning, get rid of red tapeand we'll get you more money to get houses built more quickly.' It's happening."

Last week, Housing Minister Sean Fraser responded to Poilievre's barbs during question periodby revealing that some members of the Conservative caucus have called for their communities to receive funding from the same programs Poilievre has vowed to cut.

The House Accelerator Fund gives money to towns and cities that commit to reducing red tape to build more homes. To date, 177 deals have been struck between municipalities and the federal government.

Poilievre has called the program "disastrous" and bureaucratic and has claimed it hasn't yet led to more homes being built.

WATCH |Poilievre, Fraser trade shots over their housing plans:

Poilievre, Fraser trade shots over their housing plans

9 days ago

Duration 5:44

Conservative Leader Pierre Poilievre and Housing Minister Sean Fraser had an increasingly heated exchange in question period Tuesday, which started with Poilievre asking about his own promise to remove the GST on new homes sold for less than $1 million. The two men went on to call each other arrogant and incompetent.

"What [Poilievre] doesn't know is his caucus colleagues have been going behind his back, writing me letters advocating for their communities to receive funding through the Housing Accelerator Fund because they believe it will get more homes built," Fraser said.

"My question for the Conservative members of his caucus, will they have the courage to stand up and tell him he is wrong?"

Fraser's office provided letters to CBC News from Conservative MPs Adam Chambers, Rob Moore, Michael Cooper, Dan Albas and Lianne Rood. The letters, which askFraser to grant their communitiesfunding from the Housing Accelerator Fund, were sent to the minister between September 2023 and February 2024.