TORONTO:The Canadian Taxpayers Federation (CTF) today responded to the 2001 Ontario Budget that was tabled by Finance Minister Jim Flaherty this afternoon at Queen's Park.

"Minister Flaherty gets a B minus from taxpayers for his first budget effort," stated CTF federal director Walter Robinson. "He passed the budget test but his report card should note that there is still room for improvement."

"The government's theme of responsible choices resonates both from a policy and a political perspective," added Robinson. "The Tories have shifted focus from deficit cuts to surplus choices and they have foreshadowed their partisan messaging as we move toward the next election. They will wrap themselves in the flag of responsibility while portraying the alternatives offered by their political opponents as reckless."

Debt Reduction
"We applaud the government for making the single largest debt reduction payment - some $3 billion - in Ontario's history. Debt reduction is a tax cut for our children, tomorrow's taxpayers," noted Robinson. "But we reiterate our call for a long-term, legislated debt reduction schedule. At the current pace of $1 billion per year, it will be another century before we pay down our $110.7 billion provincial debt."

 

Tax Relief

"The government has also kept its 20% income tax cut promise - to be fully implemented by 2003 - as outlined in the 1999 Blueprint campaign document," added Robinson. "Indeed this is good news for hard working Ontario families. And the commitment to raise the high-income surtax threshold from $54,000 to $70,000 that affects 340,000 taxpayers is a great first step. As well we recognize and support the government's effort to remove another 75,000 low-income Ontarians from the provincial income tax rolls entirely."

"However, while we support the principles which underlie Ontario's tax-on-income system, we can't help but notice that Ontarians would actually be paying less provincial tax if the old tax on tax payable system was kept in place and the Ontario government's tax cuts continued apace under that system."

To support this claim, Robinson outlined the current Ontario personal income tax rate projections and juxtaposed them to what they should have been if all of the federal tax cuts were passed through to Ontario taxpayers in the new tax-on-income system.

 

Expenditure Control

"Unlike the spendthrift Klein government in Alberta, the Ontario government has exhibited the courage the restrain overall program expenditure growth. We are pleased that they followed our recommendation to cap spending increases to a maximum of inflation plus population growth," added Robinson. "Program spending growth has been cut in half since last year's budget and the government has done this while living up to its commitments on health care and education."

 

Other Measures
"We are also very encouraged with the government's direction to push the envelope for a real health care debate, its plans to sell off the Provincial Savings Office and implement a new Public Sector Accountability Act, and its commitment to establish a private sector panel to review the size, scope and role of government in the 21st century," concluded Robinson. "These are responsible and fiscal choices for a formative future for Ontario taxpayers."