• Financial data shows revenues will be higher than Peters' projection
• Any deficit this year above $600-million is a Liberal deficit

Fiscal Background
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TORONTO: The Canadian Taxpayers Federation (CTF) Ontario Director John Williamson released data today projecting significant improvements to the province's revenues for the 2003/04 fiscal year. The CTF analysis is based on the Public Accounts of Ontario 2002/03, which are the government's final financial figures for last year, plus recent federal spending announcements and provincial tax increases. This information was unavailable to Mr. Erik Peters when his Report on the Review of the 2003/04 Fiscal Outlook was released on October 29, 2003.

"Mr. Peters presented a fair assessment of Ontario's finances, but the situation has improved remarkably. Based on new data, we believe the province will collect $70.29-billion in revenues this year," said Mr. Williamson. "This change is a $3.09-billion improvement over Mr. Peters' $67.2-billion revenue forecast. Mr. Peters pegged spending at $72.1-billion, resulting in a revised projected deficit this year of $1.8-billion. If Premier Dalton McGuinty fulfils his campaign commitments to eliminate what he termed government waste, the province's deficit will fall to $610-million."

In opposition, the Liberals said they had a plan to deal with a $2-billion shortfall. (See The Ontario Liberal Financial Plan, released in May 2003.) In government, the Liberals tabled Bill 2, raising tobacco and corporate income taxes; repealing scheduled personal income tax relief; and rescinding tax relief for parents with children attending independent schools as well as for seniors. According to the Finance Minister these tax changes will boost revenues by $800-million this year.

"The Liberals have already demonstrated their ability to raise taxes, but taxpayers wonder if they are equally capable at controlling spending," Williamson noted. "During the election, Mr. McGuinty insisted he had a plan to eliminate a $2-billion deficit. Raising taxes by $800-million this year has him almost halfway there, but now he must complete the job and reduce spending by $1.2-billion."