The Ontario government is moving to double the maximum tax rebate offered to first-time home-buyers while boosting the land-transfer tax on house purchases above $2 million.
Finance Minister Charles Sousa made the announcements in his fall economic statement, delivered in the provincial legislature on Monday afternoon. The changes are to take effect on Jan.1, 2017.
First-time homebuyers across Ontario will become eligible for a rebate of up to $4,000 in provincial land transfer tax, levied on the purchase of every house and condominium. Meanwhile, the land-transfer tax rate on the amount of a purchase about $2 million will rise to 2.5 per cent, from the current rate of 2 per cent.
Government officials say the tax increase on luxury homes will bring in about $105 million annually, and that will fund the increased rebate.
The government revealed today how the rising cost of housing is significantly boosting its tax revenue. Its land transfer tax revenue is up 15 per cent from its forecast in the budget delivered in February.