Home Reno Tax Credit Warning

So with all this spending on home improvement from that Home Renovation Tax Credit I’m surprised I haven’t seen much of anyone point out the obvious on the fine print on the TV ads.  It hasn’t been approved by parliament yet, so in fact it doesn’t exist officially yet on the books in the Canada Revenue Agency.

So if you are spending money on home improvements you should be aware that if there is a fall election that tax credit might not ever see the light of day on your tax form next year.  From the federal government’s point of view it’s fairly damn sneaky, get a stimulus to the economy without spending a dime of public funds.

After all if we see a government change they can also blame the fact it just go lost in the transition and the books were worse they they thought so they can’t give you the tax credit.  With record spending you know they are going to have to cut back somewhere and this is an obvious candidate.  It will carry some political backwash, but in terms of pissing people off this is easier to do than raising income tax.

To date I don’t think I’ve spent $1000 yet on home reno’s this year, so I doubt I would even use the tax credit.  It’s not that I don’t trust the government, but rather I didn’t have much planned during the time of the credit.  The hardwood was already bought prior to the credit and I’m waiting to do the kitchen reno until likely next year at the earliest (I like to save up some money prior to starting a project).

So have you been doing renovations expecting a tax credit?

4 thoughts on “Home Reno Tax Credit Warning”

  1. We were planning to build our deck this year, tax credit or not. This will just take the edge off. Many contractors are using the incentive to boost business. Frankly, I can’t justify going into debt just to get 15% of the first 10K back. Then again, I don’t like carrying debt.

  2. Despite the parties in parliament agreeing to it in principle by passing the budget, it’s sad to see it may become an election ploy this fall.

  3. The government only needs to present the draft legislation to parliament in order for the CRA to be able to enforce it.

    If an election were called before the HRTC were introduced, it would be political suiciceif the winner didn’t introduce the HRTC.

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