Stephen Harper unveils home renovation tax credit

Conservative leader’s first big-ticket promise of the campaign: Another tax break for home renovations.

Thestar.com
Aug. 4, 2015
By Bruce Campion-Smith

Conservative Leader Stephen Harper and Liberal Leader Justin Trudeau served up promises and trash talk Tuesday as they brought their campaigns to the GTA, a battleground that could prove key on election day.

Trudeau started the day with an early morning rally in Mississauga where he took aim at Harper’s economic boasts and denounced the Conservatives as a “cynical, old government.”

Backed by Liberal candidates from across the region, Trudeau accused Harper of leading a “negative, divisive government that never misses the opportunity to pick a fight but avoids every chance to solve a problem.”

Trudeau’s comments come after Harper has spent the early days of this campaign bashing the Liberal leader’s credibility on economics, a theme the Conservative leader returned to Tuesday morning as he unveiled his first big-ticket promise of the campaign - a permanent tax credit for home renovations.

Taxpayers would be able to claim up to 15 per cent of the cost of permanent “substantial” renovations to homes, condos and cottages. The tax credit would apply to renovation costs between $1,000 and $5,000, allowing a taxpayer to get back up to $750 a year.

“The home renovation tax credit helps every home owner regardless of income,” said Harper, who made the announcement at Olympia Tile on Lawrence Ave. W.

The Conservative leader said the program was good news for businesses as well as homeowners, citing the tile company as one firm that stood to benefit.

“This tax credit will help generate jobs, jobs for professional trades people ... good quality, well-paying jobs,” Harper said.

The move is expected to cost $1.5 billion a year. But exactly when the tax credit would become a reality is a question mark. Harper said it would likely be implemented near the middle of the next mandate of a Conservative government.

“This is how we have framed all of our platforms ... We make our commitments. We promise to deliver them over the course of the mandate ... in a way that is affordable for the long-term,” Harper said.

“We’ll be sure that (it) is affordable and sustainable before we bring it in.”

The Conservatives served up a similar tax break in 2009 as a temporary measure to spur spending and job creation during to the recession. That tax break was popular, Harper said, with more than three million Canadians taking advantage of the program.

In making the tax cut pledge, Harper takes a familiar page from past campaigns that have seen Conservatives promise tax credits on everything from children’s fitness and arts programs to tax breaks for apprenticeship hiring and the tools used by tradespeople.

This latest tax credit promise plays into the theme of the economy, which Harper wants to keep front and centre in this campaign, which kicked off on Sunday. At every stop so far, the Conservative leader has boasted about his government’s tax cuts, moves he says have been opposed by Trudeau and NDP Leader Thomas Mulcair.

“As Conservatives, we believe that Canadians themselves are best-placed to know what their priorities are,” Harper said, adding that Liberals and New Democrats have opposed “almost every single tax cut our government has ever introduced.

“They believe you can tax, borrow and spend your way to prosperity,” Harper said.

Harper’s campaign stop Tuesday was in the Toronto riding of Eglinton-Lawrence, now held by Conservative MP Joe Oliver, who is the finance minister.

It was a breakthrough win for the Conservatives in 2011, one of several seats they wrested out of Liberal hands in Toronto.

There has been drama around the Liberal efforts to win it back. Marco Mendicino will run for the Liberals after he defeated Tory defector Eve Adams, who failed to win the nomination battle. Adams, once a rising star in the Conservative caucus, crossed the floor to join the Liberals early in the year.

At a campaign event in a Montreal park on Tuesday, Mulcair touted his party’s proposal to raise the corporate tax rate to allow the federal government to pay for expensive programs like universal childcare.

“(We) have lowered (the corporate tax rate) so much, to the tune of about $50 billion, that we have removed the capacity of the state to do a lot of the things that we want to do in the interest of the public,” Mulcair said.

“So, when we talk about quality child care at maximum $15 a day - 1 million places across Canada - part of that money is going to come from a slight and graduated increase in the tax rate for Canada’s largest corporations.”

The Conservative government lowered the corporate tax rate to 15 per cent in 2012. They had previously lowered it to 18 per cent in 2010 and 21 per cent in 2006.

Mulcair has not yet announced the rate he would like to see, but has dropped many hints.

He has said it would be lower than the U.S. combined rate and on Tuesday added it would be “far below the average that the Conservatives had for the 10 years they’ve been in power” and “well below anything the Liberals have ever had.”

Boutique tax credits

The Conservatives have introduced dozens of new, so-called boutique tax credits since taking office in 2006. These include:

• Tradesperson’s tools deduction. Allows trades people to get a deduction of up to $500 on their incomes tax for spending on tools needed to do their jobs.
• Home Accessibility Tax Credit: Introduced this year, it provides a tax credit of up to $1,500 to seniors and people with disabilities who renovate their homes.
• Children’s Arts Tax Credit: Starting in the 2011 tax year, parents of children under 16 can claim 15 per cent of the cost of activities like art classes and piano lessons up to $500 for a maximum benefit of $75.
• Children’s Fitness Tax Credit: First introduced in 2006, the credit allows parents of children under 16 to claim 15 per cent of the cost of physical activities like hockey, soccer, horseback riding and bowling up to $1,000 for a maximum benefit of $150, which was doubled from $75 last year.
• Adult fitness tax credit: The Conservatives promised in the 2011 campaign to allow adults claim 15 per cent of the cost of registration fees for physical activities up to $500 for a maximum benefit of $75. Though the Conservatives promised to enact the credit once the budget was balanced, this campaign vow remains unfilled.