Ontario Finance Minister Vic Fedeli presented the Progressive Conservatives’ first fiscal blueprint Thursday. Here are the highlights;
PATH TO BALANCE
The Progressive Conservatives are promising to balance the province’s books in five years, which means they don’t plan to eliminate the deficit within their term.
The Tories say they’ve managed to cut the deficit to $11.7 billion a $3.3 billion reduction since taking office last summer.
The government says it plans to trim another $1.4 billion from the deficit in 2019-20, $3.5 billion in 2020-21 and $2.1 billion the following year.
In 2023-24 after the next election, the province says it will cut spending by $3.8 billion, leaving it with a surplus of $300 million.
CHILD CARE
Families with incomes of up to $150,000 will receive childcare support in the form of a new tax credit.
The government says the credit dubbed the Childcare Access and Relief from Expenses credit, or CARE is retroactive to Jan. 1 of this year.
It says on average, eligible families will receive about $1,250 in new childcare support through the program, which is expected to cost roughly $390 million each year.
Parents would need to keep the receipts for the childcare expenses they incur.
POST-SECONDARY FUNDING
Colleges and universities will see more of their funding linked to performance outcomes over the next five years.
The government says it will negotiate new agreements with the province’s 45 publicly assisted post-secondary institutions by the end of next March, and outcomes-based funding will be part of that.
It says that for years, performance has affected a small proportion of post-secondary funding: 1.4% for universities and 1.2% for colleges.
But the province says the first year of the new agreements will tie 25% of funding to performance outcomes, and that proportion will increase annually until it reaches 60% in 2024-25.
The government is also planning to amend legislation to give itself the power to address the fact that some post-secondary faculty are collecting salaries and pension payments at the same time.
It says the Ministry of Training, Colleges and Universities will consult with the post-secondary sector on how to deal with the issue.
ALCOHOL REFORM
Rules around the consumption and sale of alcohol are changing, and the government says it’s working on more reforms on the issue.
The province says it will introduce legislation allowing municipalities to pass laws permitting people to drink in parks or other designated public areas.
It is also permitting licensed establishments like bars, restaurants and golf courses to serve alcohol starting at 9 a.m. every day, and says it will consult on extending the hours further.
Bars and restaurants will also be allowed to advertise “happy hour” specials.
Those changes are expected to take effect by the summer.
The province also intends to allow corner and big box stores to sell beer and wine, as previously pledged.
CORPORATE TAXES
The Progressive Conservatives promised during the election campaign to lower the corporate tax rate but now say they’re offering a number of incentives instead that will save businesses more money.
They say allowing faster write-offs on capital investments will provide Ontario businesses with $3.8 billion in corporate tax relief over six years.
They also say cutting red tape will save businesses hundreds of millions in compliance costs.
The Tories had pledged to cut the corporate tax rate to 10.5% from 11.5%.
AUTO INSURANCE
Motorists may soon be able to show proof of insurance electronically.
The government says it will introduce legislation to make auto insurance simpler, including electronic means of communication.
It says insurance forms, policies and other documents will also be simplified so drivers can make informed decisions more easily.
The province is also reverting back to the default benefit of $2 million for those who are catastrophically injured in a collision, after it dropped to $1 million three years ago.
LICENCE PLATES AND LOGO
Ontario’s trillium logo has been revamped as part of the government’s rebranding efforts.
The government says existing “visual identifiers” across the public service will be retired and replaced with variations of the new trillium.
It says a new directive will prohibit spending taxpayer dollars on new logos or other visual identifiers from now on.
The government makeover will also affect driver’s licences and licence plates once the existing stock is used up.
Licence plates will also bear a new slogan “A Place to Grow” which will replace the current “Yours to Discover”.
ESTATE TAX
The province is eliminating the estate administration tax next year for all estates with assets of $50,000 or less.
The government says about 2,500 out of the roughly 30,000 taxable estates in the province will be exempt from the tax.
Those worth more than $50,000 will see the tax reduced by $250.
People will also have more time to file the information for the tax.
NORTHERN ONTARIO
The government is looking into ways to improve transportation in northern Ontario.
It says a review is underway to identify opportunities for a modern and sustainable transportation system in the north, including options for passenger rail service.
The review will also look at how to support rail freight and repair operations in the north.
There will also be some financial support for northern universities and colleges to help them adjust to a 10% tuition rate reduction announced this winter, a revenue loss institutions are expected to absorb.
OPPOSITION REACTION
New Democrats are sounding the alarm about what they call deep and cruel cuts in the Ontario budget.
NDP Leader Andrea Horwath says the Tories’ first fiscal plan is squeezing the education and health care sectors so their funding won’t even keep up with inflation.
Horwath says social services will also take a hit, putting the province’s most vulnerable residents at risk.
The opposition parties also questioned why Premier Doug Ford’s government was “obsessed” with booze.
(The Canadian Press)
