Kiss The Home Renovation Tax Credit Good Bye

by Tax Guy - Burlington Accountant on September 2, 2009 Print This Post Print This Post

Update: We received confirmation from Liberal Finance critic, John McCallum that the Liberals would honour the HRTC if elected. Please see the Liberal Party’s position on the Home Renovation tax Credit here.

200x300_badgeLiberal leader Michael Ignatieff announced today that the Liberal will no longer prop up the Conservative minority government. If the Conservatives fail to table the Home Renovation Tax Credit (HRTC) before an election Canadians may not have any HRTC to claim.

The HRTC Is Not Law

The Canada Revenue Agency (CRA) takes the administrative position that if tax law is tabled before the House of Commons (but not yet passed), the CRA will take steps to enforce the bill as if it were law. However, when the budget was announced earlier this year, there was no draft legislation introduced to the House of Commons for the HRTC. Therefore if the government falls before the bill is introduced into Parliament, the HRTC will be effectively dead.

Political Suicide For the Liberals or The Conservatives

Source: Wikipedia.org

Source: Wikipedia.org

If the government is allowed to fall before the HRTC is tabled, will this be political suicide? The sheer volume of questions about the home renovation tax credit posed to Canadian Tax Resource and those posed directly to the CRA suggest that thousands of Canadians may be affected if the bill is not tabled.

This may be political suicide for the Liberals if they fail to introduce similar legislation immediately after an election. This could also cause problems for the Conservatives since they failed to introduce the bill in the first place. Only time will tell for sure.

Canadian Tax Resource emailed Conservative Finance Minister Jim Flaharety and opposition Finance critic John McCallum but neither had responded at the time of writing.

About The Tax Guy...

Dean Paley CGA CFP is a Burlington accountant and financial planner who services individuals and business owners locally, nationally and internationally. Dean has appeared in the National Post, Toronto Star and Metro News.

To find out more, visit Dean's website Dean Paley CGA CFP or connect via Twitter @DeanPaleyCGACFP.

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