Ottawa urges N.S. government to eliminate sales tax on rental building projects

Sean Fraser, the federal minister of housing, infrastructure and communities, wrote Nova Scotia Premier Tim Houston on Thursday to urge the removal of the provincial portion of the Harmonized Sales Tax off rental home construction.

"We must build more homes — and we must build them by the millions," Fraser said in the letter.

"Let us be bold so we may give hope to millions of Canadians who are not living the life they had hoped for themselves, in large part because they do not have a place to live that they can afford, if they have a place to live at all."

The federal government plans to remove the five per cent it controls on the HST for goods and services used to build new apartment buildings and other rental units in this province. Nova Scotia has the power to change or remove its 10 per cent share of the HST.

"The impact of the combined removal will kick-start home building and will help offset the impact of global inflation and higher interest rates that have caused builders to pause developments that have already been approved, and are awaiting construction," said Fraser.

Provincial Liberals back proposal

Nova Scotia Liberal Leader Zach Churchill echoed that sentiment on Friday.

"I've talked to builders and developers who think this could save them substantial money when it comes to building new homes and apartment buildings," said Churchill during an interview from his constituency office in Yarmouth.

"And … when developers can build for lower costs, that means they can sell or rent for lower cost to those seeking homes or apartments on the other end."

Churchill added: "There is a housing crisis from one end of the province to the other that it's only gotten worse under the Houston government.

"This is an opportunity for him to stop pointing the finger at other orders of government and actually work with them to get more homes and apartment buildings built, more cheaply and make them more affordable for people that need them."

On Thursday, Houston accused members of Halifax regional council of exacerbating the housing crisis by "jacking" up fees associated with construction.

He was responding to harsh criticism levelled at his government by municipal councillors, who said the province needed to do more to help the growing number of people who are living in tents in the capital city.

"Maybe we can get some provincial assistance, said Coun. Lisa Blackburn.… Maybe having the Red Cross come in to help with this will embarrass the province into doing their bloody job."