$16,000 HST rebate. Is this fairness in taxation?

[lrt's friend]

I just listened to a news story where individuals doing major house renovations can get up to a $16,000+ rebate on HST associated with the renovations. Apparently this does not apply to single room renovations.

I was stunned when I heard this as this obviously applies to $100,000++ expenditures. I just wonder how this is about fairness in taxation as the average taxpayer will not be able to take advantage of this. It seems to me that this is a redistribution of our hard earned tax money from the lower and middle classes to those who are wheeling and dealing in real estate or who simply have the income to afford massive renovations.

From the CRA website:

Substantial renovation, major addition, and conversion

You may be entitled to claim the GST/HST new housing rebate if you:
•substantially renovated your existing house;
•converted a non-residential property into a house; or
•built a major addition onto your existing house if, along with that addition, you also renovated the house.

I see this relates to rebates on house purchase HST to make housing more affordable, but it is subject to abuse when renovations are funded by the taxpayer or to increase house resale value.

[1overcosc]

I'm fairly certain there's also an HST rebate program for first-time home buyers, this helps with social mobility.

[Harley613]

As someone about to take on massive renovations of my properties i'm not gonna complain haha. Do you have any links?

[c_speed3108]

There are a few inter-related credits that from what I can judge appear to be designed to improve the national housing stock. What you mention is only one of them.

The full guide is here:

http://www.cra-arc.gc.ca/E/pub/gp/rc4028/rc4028-e.html

[MoreTrains]

It seems to be the benefits of this HST rebate outweigh (after apprecation of the property post-renovation) that of the First Time homebuyers rebate. So no, not fair, but how much in the tax system is? If you want fair, you reduce the taxation on the lowest tax bracket, that way everyone upto approx 20k pays less tax, and then any amount they make above 20k they pay as per current. In cutting tax this way, a larger percentage increase in income is realized the less you make. But, as I said, how much of the tax system is fair?

[Norman Bates]

It's probably a strategy to prevent the underground economy rampant in home renovations.

Pay the taxes up front and get a rebate. But then money expended also gets taxed as the contractors revenue/income.

[Dundas]

Pay for a reno permit from the city and then we will refund you hst. No thanks.

[Buggys]

From the CRA link, it looks like most renos won't qualify. This is basically a tax credit for building/rebuilding a house.