January 1, 2008, the GST drops to 5% from 6%.
GST must be paid on the purchase of new construction residential property, and the GST that must be paid on substantial renovations where 90% or more of the structure has been replaced and qualifies as new property.
There is no GST charged on residential re-sale property. Therefore this reduction does not affect re-sales.
Highlights: The important time frame when the GST becomes payable on the transaction.
Pre-October 30, 2007 contract / pre-December 31, 2007 possession and ownership: the 6% GST applies.
Pre-October 30, 2007 contract / post December 31, 2007 possession and ownership: the 5% GST applies.
Post October 30, 2007 contract / pre-December 31, 2007 possession and ownership: the 6% GST applies.
Post October 30, 2007 contract / post December 31, 2007 possession and ownership: the 5% GST applies.