B.C. Election: Conservatives promise provincial tax rebate to offset housing costs for renters and homeowners

The rebate would eventually allow renters and homeowners with mortgages to write off $3,000 per month from provincial income taxes.

Published Sep 23, 2024  •  2 minute read

B.C. Conservative leader John Rustad in Surrey on Monday. Photo by Arlen Redekop /PNG

B.C. Conservative leader John Rustad said Monday that if he is elected next month, he will implement a rebate to offset high housing costs for renters and homeowners with mortgages.

The rebate would eventually allow renters and homeowners with mortgages to write off $3,000 per month from provincial income taxes.

The program would begin by allowing exemptions of $1,500 per month, starting in 2026. This would cost an estimated $900 million in the budget for that year, according to the party.

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The amount that could be exempted would move up by $500 each year until it reached $3,000 per month in 2029 when the program would cost an estimated $3.5 billion.

The party didn’t have details on how the rebate would be funded, and Rustad said the Conservatives would need time to look at the budget.

“Are we going to be able to balance right away? No. But we need to make sure that we’re providing tax relief immediately,” said Rustad on Monday.

Asked what renters and homeowners might expect to save or receive by using the rebate, Rustad said when fully implemented at $3,000, the amount for an average income earner could be around $1,600 to $1,700 in annual savings.

Rustad said the party was still looking at numbers, but the rebate would be means-tested with a cap at around a household income of $250,000 a year.

Postmedia asked the party for more details on how income levels and rent and mortgage amounts would impact the rebate.

At the Canadian Centre for Policy Alternatives, senior economist and public finance policy analyst Alex Hemingway said some economists are trying to figure out if the rebate would be in the form of a refundable tax credit or a deduction?

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“The more straight-forward way to ask it is, what if you are paying little or no income tax, can you still benefit from this?”

Hemingway said that, more broadly, the rebate doesn’t address the core issues of the housing crisis.

He added that putting cash into the hands of renters and homeowners with mortgages like this doesn’t make for good housing policy when there is a shortage of homes because this tends to inflate rents and prices.

Rustad has previously said if the Conservatives take power they will axe the B.C. NDP’s Bill-44 that mandates municipalities to enact bylaws for higher density on individual residential lots. He has said he would revert to municipalities being in charge of their own zoning so that sewer, water, parking and infrastructure decisions are made at the same time.

On Monday, he said the tax rebate was about affordability and people being able to get into housing and paying rents. He added that more significant policy announcements on housing and the party’s various approaches would be coming in the week ahead.

The NDP introduced a renter’s tax credit of $400 in 2023 for low- and moderate-income renters with a household income of $60,000 or less. The credit is reduced to zero when adjusted household income hits $80,000.

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