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Ottawa, February 3, 2004
2004-007

Finance Minister Will Propose Legislation to Make 100-Per-Cent GST Rebate for Municipalities Effective as of February 1, 2004

Related document:

• Backgrounder: Full GST Rebate for Municipalities.

Finance Minister Ralph Goodale confirmed today that, pending parliamentary approval, municipalities will have an increased source of reliable, predictable and long-term funding to address priorities such as public transit and road maintenance.

The Minister said that legislative amendments will be proposed to implement, effective February 1, 2004, the full rebate of the goods and services tax (GST) and the federal portion of the harmonized sales tax (HST) that municipalities now pay, as announced by the Prime Minister.

Increasing the rebate to 100 per cent from the current 57.14 per cent means that municipalities will get about $7 billion more over the next 10 years, including about $580 million in the first year alone, to help address infrastructure needs.

"If approved, the full rebate will represent a real boost to municipalities of all sizes across Canada," said Minister Goodale. "This action recognizes the key role of infrastructure investments in the well-being and prosperity of all Canadians."

The Minister indicated that the Government will introduce legislation in Parliament at the earliest opportunity to implement the full rebate and all necessary consequential amendments. Further details on the measure and its operation will be provided in the very near future.

A backgrounder containing further information is attached.

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