The 2017 federal budget announced Wednesday, March 22 put to rest the possibility of national foreign homebuyer taxation or changes to capital gains taxes, while revealing plans for multibillion-dollar investment in affordable housing.
Minister of Finance Bill Morneau revealed that the federal government is investing $11.2 billion to support a National Housing Strategy. Moreau considers it, “the largest single commitment in Budget 2017.”
The $11.2 billion will be spread out over the next 11 years, and includes:
- $5 billion for a national housing fund to support creation of new affordable housing and rental units, administered by the Canada Mortgage and Housing Corporation (CMHC);
- $3.2 billion for provincial efforts to support affordable housing;
- $2.1 billion to address homelessness; and
- $241 million for CMHC to improve data collection.
In an effort to create a sustainable social housing sector, the government says it will also make more federal land available for housing projects.
“We’re repairing nearly 50,000 social housing units, to make sure families have a safe and secure place to live,” Morneau said.
Absent from the budget are any plans for expansion of the foreign buyer tax currently only in affect in the Lower Mainland, or steeper capital gains taxes to curb real estate speculation. However, feds are investing nearly $40 million over the next five years to create a new nationwide housing database that will track foreign ownership.
“The [Housing Statistics Framework] will represent a significant jump forward in the quality and type of housing data available and will yield significant ongoing benefits by enhancing the ability of housing participants, commentators and policy-makers to monitor and analyze the housing market,” according to the 2017 budget.
There were no major changes to tax measures, though Morneau said the government is committed to providing a fair tax system to the benefit of the middle class, with details to follow.
More than $5.9 billion will be dedicated infrastructure development over the next year, with a focus on transit projects.