POSSIBLY the best piece of legislation to come from the federal government in decades has been the Home Renovation Tax Credit.
Introduced in the 2009-10 budget, the HRTC was designed to stimulate the economy in a time of recession. The basic premise was that the consumer would receive a rebate on their taxes if they renovated some aspect of their home. The rebate was 15 per cent of moneys spent between $1,000 and $10,000. Therefore, for renovations of $10,000 and above, one would receive a tax credit of $1,350.
Imagine -- the government was giving us money back if we spent money on something we needed to purchase in the first place. This was a deal!
The timing couldn't have been better. The entire world was mired in a recession and Canada was no exception. Manitoba was not impacted to the same degree as Ontario, Alberta and B.C., but our manufacturing sector, especially those dependant on U.S. trade, was definitely hit hard.
Consumers stepped back from their customary purchasing habits, further impacting the economy. The HRTC not only encouraged people to upgrade their houses by way of renovation, it also helped many other sectors. In the case of manufacturers who produced goods for the home such as windows, floors, cabinets and counter tops, the HRTC provided an economic incentive that encouraged the consumer to keep buying through tougher times. This meant that they could continue to operate their production plants, thereby keeping their employees working. Sales staff were also busy.
Professional renovators, handymen and do-it-yourselfers were kept busy all year with various projects. The beauty of the HRTC was that both labour and materials were eligible for the rebate. All benefited from it.
So, the consumer wins, the manufacturer wins, the sales staff and retail outlets win. We're still not out of the woods yet, so why discontinue the HRTC before the final numbers were even assessed? Perhaps there is an opportunity here for the Manitoba government to implement some updated version of the Home Renovation Tax Credit, maybe one tied to energy or water savings. It's worth a thought.
Mike Moore is president of the Manitoba Home Builders' Association.
