Nova Scotia Premier Tim Houston has announced a one per cent cut to the HST next year.
The provincial part of the HST will drop nine per cent from 10, meaning Nova Scotians will be paying a combined HST of 14 per cent.
“Now, in addition to indexing the personal income tax, we’re lowering the HST rate to help people who are struggling with the cost of living and additional taxes from the federal government,” said Houston in a news release, while adding it will be the “largest tax break in Nova Scotia’s history.”
Houston’s announcement comes at a time of growing speculation of an early provincial election call. Houston said the tax changes would take effect April 1, 2025. Under a new piece of Nova Scotia’s Elections Act, the next provincial election is slated for July 15, 2025.
On Tuesday, MLA Fred Tilley crossed the floor from the Opposition Liberals to join the governing Progressive Conservatives.
Houston was asked whether Tilley’s switch was the prelude to an eventual snap election call sometime later this week. The premier didn’t reply directly but mused about the current political landscape.
“It is probably obvious to everyone that there is incredible turmoil in Ottawa right now and what happens in Ottawa can have a significant and immediate impact on Nova Scotia,” he said. “I’m watching … and I need to make sure that Nova Scotia is in a strong position to bargain with the federal government and be treated fairly.”
HST is second largest revenue source
HST is the second largest provincial revenue source.
According to the province’s calculations, the one percentage point reduction to the provincial value-added tax rate is expected to reduce revenues by about $260.8 million in the 2025-26 fiscal year; $265.5 million in 2026-27; and $272.4 million in 2027-28.
Three other provinces have a harmonized sales tax. Newfoundland and New Brunswick have theirs set at 15 per cent, and Ontario is at 13 per cent.
— with a file from The Canadian Press