2025 Ontario Fall Statement

On May 27, 2025, the federal government proposed eliminating the full federal portion of the Harmonized Sales Tax (HST) on qualifying newly built or substantially renovated homes valued up to $1 million for first-time home buyers. Ontario is taking steps to mirror this proposed federal Goods and Services Tax/Harmonized Sales Tax (GST/HST) First-Time Home Buyers Rebate, and, subject to passage of federal legislation that would bring the rebate into force, Ontario will work with the federal government to implement a new Ontario rebate.
 
The new Ontario rebate would be available in addition to the existing Ontario HST New Housing Rebate, which already provides relief of up to $24,000 to eligible purchasers, including but not limited to first-time home buyers.

The new Ontario rebate, together with Ontario’s existing HST New Housing Rebate, would provide relief of the full 8 per cent provincial portion of the HST on qualifying new homes valued up to $1 million for first-time home buyers. The new Ontario rebate would follow the linear reduction under the proposed federal rebate for new homes valued between $1 million and $1.5 million. However, for new homes over $1 million, the combined amount of relief available under both Ontario rebates would not be less than what Ontario currently provides under the existing rebate. For example, an eligible purchaser of a new home valued at $1.35 million or above would still qualify for $24,000 in total provincial relief.
 
The province will work with the federal government to propose that the new Ontario rebate be available if the agreement of purchase and sale for the home is entered into with the builder on or after May 27, 2025, and before 2031. Construction of the home must begin before 2031, and the home must be substantially completed before 2036.

Eligibility criteria for the new Ontario rebate would follow those set by the federal government, including that the individual must be acquiring the new home for use as their primary place of residence.

Details of Ontario’s proposed new rebate are based on the federal government’s proposal as announced on May 27, 2025. Implementation of the new Ontario rebate is subject to passage of federal legislation and requires federal regulatory changes. Ontario will continue to monitor the status of the federal proposal as it progresses through the federal legislative process.

The government introduced several tax measures as part of the 2025 Budget to provide targeted support for businesses. The government is now proposing amendments to the Taxation Act, 2007 to implement these measures. The proposals will be included in the bill accompanying this 2025 Ontario Economic Outlook and Fiscal Review.

Key measures include the following proposals:

• A temporary enhancement of the Ontario Made Manufacturing Investment Tax Credit (OMMITC). This proposed change would increase the refundable tax credit rate for qualifying Canadian-controlled private corporations (CCPCs) from 10 per cent to 15 per cent for eligible investments made on or after May 15, 2025, and before January 1, 2030.
• A temporary expansion of OMMITC eligibility that would provide a 15 per cent non-refundable credit to corporations other than CCPCs. Qualifying corporations for the non-refundable credit would be required to carry on business in Ontario through a permanent establishment in Ontario, and would include public corporations, foreign-controlled corporations and non-resident corporations. This proposed expanded OMMITC would be available for eligible investments made on or after May 15, 2025, and before January 1, 2030.
• A provision to repeal the refundable OMMITC effective January 1, 2030. Expenditures would need to be incurred on or before December 31, 2029, in order to be eligible for the credit. Prior to the expiration, the government will continue to review the OMMITC every three years to assess its effectiveness, compliance burden and administrative costs.  

The province will amend a regulation under the Land Transfer Tax Act that is related to the Non-Resident Speculation Tax (NRST) to support economic investment in Ontario. A new NRST rebate would provide relief for the purchase of a residential property that has been repurposed for industrial use. The rebate would be available for conveyances of property occurring on or after November 6, 2025.

To qualify, a property would have to be reclassified into the Industrial Property Class, Large Industrial Property Class, or Aggregate Extraction Property Class as defined under the Assessment Act with respect to a year that is no later than four years after the purchase.