Conservative leader Pierre Poilievre has promised to remove Canada’s 5% federal sales tax on new homes priced below C$1 million ($719,700) if elected as prime minister. Currently leading in polls by around 20 points, Poilievre stated that the tax break would offer homebuyers an estimated annual savings of C$2,200 on an C$800,000 mortgage. He also committed to advocating for provincial tax reductions on new home sales.
Should the Conservatives secure victory in the October 2025 election, Poilievre intends to cancel the C$4 billion housing accelerator fund, which has allocated about C$1 billion to cities, including C$471 million to Toronto, to reduce zoning restrictions and promote higher housing density. Furthermore, he plans to eliminate the C$5 billion housing infrastructure fund, set to be distributed to provinces in January 2025, to help finance this tax cut.
Poilievre argued that this tax cut would stimulate new housing construction, potentially generating an additional C$2.1 billion in government revenue annually, which would offset the projected C$4 billion cost over a four-year period. He stated, “This is a fiscally responsible plan to cut taxes, build homes and bring back the promise of Canada, of hard work enabling people to buy a home in safe neighborhoods.”
The current government has introduced a 36% rebate on sales tax for new or heavily renovated homes valued under C$450,000 and invested in programs to address housing affordability. Housing Minister Sean Fraser criticized Poilievre’s approach, warning that removing these funds would harm essential housing programs for middle- and low-income families. Fraser highlighted that these programs encourage urban centers to adopt measures like digital permitting to streamline homebuilding. He also expressed concern that Poilievre’s plan might favor corporate investors, potentially sidelining lower-income Canadians.
Policy director Mike Moffatt estimated that the tax cut could cost about C$4.5 billion annually. While he expressed reservations about canceling the housing fund, Moffatt acknowledged that the tax relief could benefit young, middle-class Canadians by making homes more affordable.