There’s one bright spot in Premier Doug Ford’s budget.
He announced plans to cut taxes for low-income Ontarians, saving over one million taxpayers up to $850 next year. This will serve as much needed relief for taxpayers who badly need it in the wake of record-high inflation and soaring living costs.
But that’s where the good news ends.
This year’s budget gave Ford an opportunity to chart a new course after years of poor financial stewardship across multiple governments.
With an historic provincial debt load and half of Ontario families $200 away from not being able to pay their bills, taxpayers were looking for a budget with fiscal prudence coupled with comprehensive tax relief.
Instead, the Ford government’s budget had no concrete plan to balance the books and no tax relief for middle class families.
Two weeks ago, Ontario’s independent Financial Accountability Office projected the Ford government could balance the books by next year if this year’s budget simply held the line on new spending.
When you add in savings from eliminating things like political and corporate welfare, a balanced budget coupled with tax relief was within reach.
Sadly, Ford opted to go on a spending bonanza.
Ford’s spending spree is so reckless that the government plans to run a bigger deficit this year than it did during the pandemic. The government expects its 2022-23 deficit to come in at a whopping $19.9 billion.
The government also completely abandoned its plan to reduce the tax burden on the middle class. As families face financial hardships, now could have been the perfect time for Ford to introduce the sweeping tax cuts he promised Ontarians four years ago.
When running in the last provincial election, Ford promised to slash the second income tax bracket by 20 per cent. Had Ford followed through on his commitment, he would have implemented the most significant tax relief measure in Ontario in a generation.
But instead of cutting taxes, Ford chose to increase government spending by a staggering $11.5 billion.
Late last year, Ford claimed that his guiding economic theory is to “put more money in people’s pockets,” but his budget favours heavy spending over comprehensive relief. Ford plans to ramp up spending at a rate that would make his spend-happy predecessors blush.
With the Ford government’s budget now tabled, it is crystal clear that all of Ontario’s political parties intend to compete to out-spend each other, with little thought to delivering tax relief for most Ontarians.
Yet, Ontario’s political parties will do so to their own detriment. Affordability will be the bull in the china shop this election and politicians who try to ignore it won’t be able to do so for long.
But Ontarians don’t need billion-dollar programs to make their lives more affordable. The answer is to leave more money in taxpayers’ wallets in the first place.
Taxpayers don’t want gimmicks. They want bigger paycheques.
Ford missed a major opportunity to deliver on what taxpayers are looking for when he turned his back on the income tax relief plan that he himself once authored.