Will The McGuinty Government Finally Show Economic Leadership?

March 25, 2008

Today is Budget Day in the Province of Ontario.

The decisions that Ontario Premier Dalton McGuinty takes in today’s budget will have a massive impact not only on the economy of his own province, but also on Canada as a whole.

Ontario’s economy is currently in a very perilous position. The strong advantages that Ontarians have traditionally relied on in sectors such as manufacturing on are now at risk.

Many of the forces that are currently challenging the Ontario economy, including rising fuel prices and a higher Canadian dollar, are beyond any government’s control. Even so, many of the McGuinty Government’s current tax policies are leaving tens of thousands of jobs at risk.

Business taxes in Ontario are currently the highest in Canada. Unless Mr. McGuinty makes serious changes in today’s budget, Ontario’s overall tax rate on new business investment will go as high 30.7 per cent in 2012. In comparison, Quebec’s tax rate will only be 18.8 per cent.

By relying on such arbitrary and high taxes, the McGuinty government is not only punishing businesses, they are actively imposing taxes on jobs. The result is a sluggish economy, tens of thousands of jobs lost, and hundreds of thousands more at risk.

To date, the Conservative Government has done its part to reduce taxes and ensure that all Canadian businesses, including Ontario’s retain their competitive edge. Now it is up to the Ontario Government to follow suit.

Will Mr. McGuinty finally begin reducing the provincial business income tax rate? Will he make a commitment to fully eliminate the capital tax for businesses in all sectors? Will he take real steps towards harmonizing Ontario’s retail sales tax with the GST or, at the very least, begin transitioning the provincial sales tax into a value added tax?

These are all strong examples of leadership that Mr. McGuinty can begin acting on today. The Conservative Government will applaud any such moves to reduce taxes on jobs in the province in Ontario.

Liberal and NDP governments in Quebec, Manitoba and BC have already shown this kind of leadership to keep local economies growing and strong.

Now it is Mr. McGuinty’s turn. Will he finally show the leadership necessary to protect and create jobs in the province of Ontario? Or will he continue on the path of out-of-control taxes and spending that has already cost Ontario so much?