Cut the HST, keep the budget balanced and end corporate welfare
To ring in 2023, Ford should commit to cutting the sales tax, keeping the budget balanced and ending corporate welfare.
As inflation hammers Ontario families, the Ford government has a dirty little secret: it’s profiting from inflation.
Sales taxes are charged as a percentage of the overall price of a good or service. When prices go up, so does government revenue.
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Last year alone, the revenue the government of Ontario brought in through sales taxes increased by a staggering $4 billion.
As Ontarians struggle to pay their grocery bills, fill up their gas tanks and pay their home heating bills, inflation relief is more important than ever.
Because of inflation, Ontario workers have essentially lost one month’s wages compared to last year.
With families facing such a major budget crunch, the last thing the government should be doing is raking in more dough.
Cutting the HST by one percentage point would leave roughly $3.8 billion in taxpayers’ wallets, paid for entirely by giving the extra sales tax revenue back to the people, where it belongs.
The second resolution Ford needs to make is to keep the budget balanced.
When the final budget numbers came in for the last fiscal year earlier this fall, to Ford’s credit the government revealed that the province balanced its books for the first time in over a decade and ran a $2.1 billion surplus.
That’s a good thing.
But the Ford government has already announced that it plans to plunge the province back into the red next year and stay there for the foreseeable future.
Ontario is already spending more than $1 billion per month on debt interest. If we didn’t have to pay that bill, the province could afford to build 10 brand-new hospitals over the course of the next year.
It is morally wrong to leave a fiscal fiasco waiting for the next generation.
Instead of plunging Ontario back into deficit territory, Ford should resolve to find ways to reduce the province’s bloated budget.
A great place to start would be to bring government employees’ wages in line with Ontarians working in comparable jobs in the private sector. Doing so would promote fairness and save the province billions.
Speaking of savings, Ford should have a third resolution for the new year: ending corporate welfare.
Ontarians don’t want to see their tax dollars go to Queen’s Park only to be handed over to profitable corporations.
Earlier this year, the Ford government handed over half a billion dollars to Stellantis, a Fortune 500 company, to retool its auto plants in Windsor and Brampton. Stellantis is a massive corporation with consistent profits. It doesn’t need taxpayer help.
If Ford genuinely wants to attract investment and create jobs in Ontario, which is his supposed motivation behind corporate welfare handouts, he should cut corporate taxes. It makes far more sense to lower taxes to attract businesses of all shapes and sizes rather than dole out hundreds of millions of dollars to a single profitable company.
Unfortunately, Ford has a long track record of handing out taxpayer cash to profitable corporations. He did the same thing with the Ford Motor Company a couple of years ago.
If Ford adopts these three key resolutions – cutting the sales tax, keeping the books balanced and ending corporate handouts – he will put his government, and all of Ontario, on a better path.
Jay Goldberg is the Ontario & Interim Atlantic Director for the Canadian Taxpayers Federation.
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