If the Ford government addresses three key points – spending control, tax relief and structural change – it will begin to earn back the trust of disappointed Ontario taxpayers. Pictured: Ontario Finance Minister Peter Bethlenfalvy. Photo Credit: The Canadian Press/Chirstopher Katsarov.
Finance Minister Peter Bethlenfalvy has a chance to turn the page on six years of taxpayer disappointment as he prepares to release his 2024 budget.
Since the Ford government came to power in 2018, Ontario’s debt has increased by a staggering $80 billion. The government has run one surplus in six tries. And the kind of substantive income tax relief the Progressive Conservatives campaigned on in 2018 seems like a distant memory.
The Ford government was elected on a mandate to stop the spending spree and deficit parade at Queen’s Park. The truth is this government has been just as fiscally reckless as its predecessors.
But as they say, hope springs eternal.
Bethlenfalvy could right the ship when he releases his budget later this month if he makes three important policy changes.
First, it’s time to end Ontario’s addiction to deficit spending.
Taxpayers are on the hook for more than $1 billion a month in debt interest charges. That’s enough money to build 12 new hospitals a year or reduce Ontario’s health tax by 25 per cent.
Bethlenfalvy is anticipating a deficit of $5.2 billion in 2024-25. If the province were to go back to 2022-23 spending levels – the amount of money Ontario was spending just 14 months ago – Bethlenfalvy could wipe out the deficit and have $14 billion left over for tax relief.
That brings us to point number two.
Ontarians elected the Ford government on a promise to lower the tax burden. The cornerstone of Ford’s 2018 election platform was a pledge to cut Ontario’s second income tax bracket by 20 per cent, saving the average middle class taxpayer $786 a year.
Six years later, that income tax cut is nowhere to be found.
Ontarians are barely scraping by these days. The federal carbon tax has made the cost of gas, groceries and home heating more expensive. Inflation has eaten away at taxpayers’ purchasing power. And housing prices are soaring.
At a time when 50 per cent of Canadians say they’re $200 away from not being able to pay their bills and 400,000 Ontarians are working two jobs just to stay afloat, it’s crystal clear tax relief is sorely needed.
Ford should look at cutting the sales tax. Reducing the provincial portion of the HST from eight per cent to six per cent would save the typical Ontario family $1,418 a year. That money would do more good in the pockets of hardworking taxpayers than in the hands of bureaucrats and politicians.
It would also help offset rising prices on food, fuel and home heating.
The third important policy change for the Ford government to make is structural. Ontario has only run a handful of surpluses since the turn of the century. At the same time, the province’s debt has increased by roughly $300 billion.
It’s time to address the underlying problems in the way the province approaches finances.
A new law should be introduced requiring governments to balance budgets unless the province is in an emergency circumstance, such as a once in a generation natural disaster. And a new line item should be added to the budget dedicated to paying down the province’s dangerously high debt.
If the Ford government addresses these three points – spending control, tax relief and structural change – it will begin to earn back the trust of disappointed Ontario taxpayers.
Halfway through its present mandate, it’s time for the Ford government to deliver for taxpayers as it looks toward securing a third term. That begins with Bethlenfavly’s March budget.
Jay Goldberg is the Ontario Director at the Canadian Taxpayers Federation. He previously served as a policy fellow at the Munk School of Public Policy and Global Affairs. Jay holds a Ph.D. in Political Science from the University of Toronto.
