Stephen Harper's Conservatives could pre-empt a Liberal attempt to bring down the government as soon as Parliament resumes by tabling a motion of confidence on the highly popular home renovation tax credit, CBC News has learned.

Prime Minister Stephen Harper, shown in August in Kitchener, Ont., said this week he would not be making any 'backroom' deals with other opposition parties to prevent his government from being defeated. (Dave Chidley/Canadian Press)

The Conservatives need to introduce a budget ways-and-means motion sometime in the fall that would allow the government to spend money and raise taxes.

Conservative sources told CBC News late Wednesday it is possible the government will introduce the motion at the beginning of the fall parliamentary session on Sept. 14, which could lead to another election as soon as mid-October.

Over the summer, the prime minister urged Canadians to take advantage of the tax credit, even though it hasn't actually been approved by Parliament.

The 15 per cent credit is the subject of a massive advertising campaign and is designed to be part of the government's economic stimulus package. It could see eligible applicants receive as much as a $1,300 refund on their taxes if they invest up to $10,000 on improving their homes between Jan. 27, 2009, and Feb. 1, 2010.

But unlike other elements of the government's stimulus package included in the January budget that were passed in a budget implementation bill in early March, the Tories held back the renovation tax credit and its projected cost of $3 billion over two years for a second budget bill slated for the fall session.

Ignatieff has already signalled his party will move a motion of no-confidence or vote against the Conservatives at the first available opportunity. The first opportunity for the Liberals to introduce their own no-confidence motion is on Oct. 1.

Observers say the move could hurt Ignatieff's party by forcing them to vote against a program the Liberal say they support, and that that has proven extremely popular with Canadians over the summer. The Liberals say they would reintroduce the program once elected and have dismissed the Tories' claims a fall election would scrub the credit as fearmongering.

"This is just a Conservative game," Liberal finance critic John McCallum said.

The Canada Revenue Agency has administered the tax credit under the assumption that it would be made into law in the fall session, but has not commented on what effect, if any, a fall election would have on the program.

Tories will look at 'effective ideas': PM

But even if a motion of confidence is held this month or in October, it is not clear whether the Conservatives would be defeated. The Liberals would need the support of both the NDP and the Bloc Québécois.

Harper did not mention the tax credit on Thursday, but told reporters he would not be making any "backroom" deals with other opposition parties to prevent his government from being defeated.

"As I’ve said before, if other parties have good ideas, effective ideas on the economy, let us see what they are and we’ll take a look at them," he said.

"As you know, we’ve been very flexible in terms of bringing forward initiatives and programs, but we will not be doing backroom deals."

NDP Leader Jack Layton called on Harper to "reach out" to opposition parties, saying Thursday the prime minister "has a responsibility to understand that he cannot govern alone."

Bloc Québécois Gilles Duceppe said Wednesday his party would continue to support the interests of Quebec in the House of Commons, but did not rule out supporting the government in any no-confidence vote.

"If it's good for Quebec, we're supporting it. If it's not, we're opposing it, and we will be facing the consequences," Duceppe told reporters in a news conference in Bois-des-Filion. "We are ready."