The Liberal government of Ontario Premier Dalton McGuinty delivered its last budget before the upcoming provincial election Thursday afternoon, hitting some of the same notes as the federal Conservatives only a few days before.
The balanced budget included a number of measures aimed at fighting child poverty, helping low income families and aiding the environment. In many ways the Liberals appear to have responded to NDP criticisms on a number of fronts in the hope it will help win votes in the October election.
The centrepiece, leaked several days in advance, is a commitment to keep increasing the minimum wage over the next three years to $10.25. It's become a controversial hot-button issue, with activists saying the province's working poor need a $10 wage now. On the other hand, business owners warn it could cost jobs as they attempt to absorb additional payroll costs on top of the increases to the minimum wage already made over the past few years.
In his budget speech, Finance Minister Greg Sorbara announced a $310-million surplus. He touted the budget as the "the clearest evidence of our economic strength." However, his comments come at a time when Ontario's key economic engine, the manufacturing sector, has lost tens of thousands of jobs and continues to struggle with a strong loonie and a weak automotive sector. No new measures to aid the manufacturing sector were introduced in the budget.
New measures in the budget included an attempt to address some of the problems in the much maligned property tax assessment system that is used by municipalities to determine residential and commercial property taxes.
Here are other highlights. Stay turned to OttawaBusinessJournal.com through tomorrow morning for comment and reaction, including Mayor Larry O'Brien.
For business, the business education tax rate will be cut by $540 million over the next seven years in 321 municipalities, which could make it easier for small businesses to absorb a higher minimum wage.
The capital tax rate will be eliminated by 2010 instead of the previous timeframe of 2012.
A "fair and predictable" property reassessment system that will assess once every four years instead of annually. When property values go up, the increase will be phased in over the four-year period, so property owners are not slammed with big property tax hikes in one year. Homeowners will not face increased taxes based on property values until the 2009 tax year.
A five-year, $2.1 billion Ontario Child Benefit for low-income families expected to help 1.3 million children. Starting in July, families with a net income of $20,000 or less will receive $250 per child a year, with the benefit increasing to $1,100 by 2011.
New $185-million housing allowance for low-income families with children.
Taking a cue from the federal budget tabled by the Conservatives on Monday, seniors will be allowed to split some types of pension income for total tax savings of about $170 million this year.
new life income fund to allow seniors access up to 25 per cent of their locked-in retirement funds.
$125 million for environmental initiatives such as home energy audit rebates and tree planting.
$18.3 billion in funding for the province's school boards, an increase of $781 million from last year.
$37.9 billion in health spending
$5.9 billion to build new infrastructure in 2007-08, including $1.7 billion for the provincial highway system.
* To print this page, click on the "Printer Friendly Version" link above. When the new
window opens, right-click with your mouse in the new window and select "Print".
