N.L. to cut home heating costs

Newfoundland and Labrador Home Heating HST Rebate delivers 8 percent provincial tax relief on electricity and fuel heating, credited on utility bills, amid a budget surplus, high oil prices, and election-year policy for residential energy.

People across Newfoundland and Labrador will receive an eight per cent rebate on electricity and heating fuel, according to the provincial 2011 budget.

The program is expected to cost the provincial government about $38 million annually — a loss the government says it can afford, echoing optimism about rebates in other provinces, as it announced a surplus of $485 million for the past fiscal year and is forecasting a $59-million surplus for the coming year.

"Oil prices are high and it appears that these prices are going to be sustained at high prices," said Finance Minister Tom Marshall. "So we felt it was time to give back."

The new rebate program will begin on October 1 — 10 days before the next provincial election — amid debates similar to utility discount promotions in other jurisdictions, but Marshall deflected criticism that the budget aims to buy votes.

"It is an election year but I don't see any difference between this budget and the budgets I've done in the past," said Marshall, who delivered his fourth budget.

The rebate will apply to all residents, similar to one-time hydro rebates seen in Ontario, using fuel and/or electricity to heat their homes.

After the announcement NDP Leader Lorraine Michael celebrated the home-heating rebate announcement.

"To quote another politician 'We got it'," said Michael, referring to what Danny Williams said after negotiating the Atlantic Accord deal with former Canadian Prime Minister Paul Martin.

Michael who had called for the rebate said the announcement shows the difference one lone voice house of assembly can make.

The new rebate will be in addition to the existing the current home heating rebate program for low-income individuals and families.

According to the government's plan, the savings will appear on bills consumers receive from oil and electricity companies, similar to lump-sum electricity credits announced elsewhere, and those companies will then invoice the province for the rebated amount.

Government officials said details of how it will work with those companies, and with senior confusion over rebates highlighted elsewhere, have not been hammered out yet.

The rebate is equal to the eight per cent provincial portion of HST on residential electricity and heat.

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