‘Ontario Budget Gets a Passing Grade – Barely. Deficit continues to grow: projected $11.7 billion shortfall in 2013-14. Payroll tax relief: exemption threshold for Employer Health Tax raised’ — Canadian Taxpayers Federation
By Candice Malcolm –
The Canadian Taxpayers Federation (CTF) gave the provincial budget a barely passing grade, acknowledging modest payroll tax cuts and spending reductions in several departments, while criticizing the overall failure to stop the growth of spending and control the growing deficit.
This budget fails to rein in spending in any meaningful way. Ontario needs some tough medicine, and instead, this government caved to NDP demands with targeted hand-outs to special interests and continued growth in both spending and borrowing.
Ontario will spend $127.6 billion this year – $3.6 billion more than 2012, and will borrow an additional $33.4 billion.
Ontario cannot continue spending at this rate. The projected deficit in this budget is higher than the registered deficit last year. We are heading in the wrong direction.
Ontario’s debt-to-GDP-ratio will inflate to 39.3 per cent with no sign of reduction until 2017, and the province will spend an additional $10.6 billion servicing its mounting debt.
There were a few good initiatives for taxpayers buried in today’s budget.
The government has reportedly delivered on 60 per cent of the Drummond Report, which puts Ontario on a long-term path to addressing the structural deficit.
Reducing the payroll tax burden is good news for small businesses and economic growth in the provinces.
Under the new regime, the threshold for paying the Employer Health Tax (EHT) will be raised from $400,000 to $450,000.
There are some glimmers of light in this budget, but the overall outlook is still one of fiscal imbalance and too much spending.