Ontario will lead Canada in job creation again. We should accept nothing less.
In fact we can't accept anything less. We need a thriving and dynamic private-sector economy if we want to invest in core public services like top quality health care, first-class education and new transit infrastructure to break gridlock.
These two aspirations -- to be the engine of Canadian jobs again and to have world-leading public services -- are interdependent, not separate, goals. We can't have one without the other. And Ontarians deserve both.
But we need to be clear-eyed about where those new jobs and resultant tax revenues will come from: a growing private-sector economy. We've tried the alternative -- continuous government borrowing, taxing and spending -- and it hasn't led to either private-sector job creation or sustainable public services.
The Ontario PCs' Paths to Prosperity: An Agenda for Growth -- the fourth in a series -- proposes a very different approach of smaller, more focused government and a level playing field for all to succeed through freer trade, less government interference and broad-based, substantial tax relief. To read all our Paths to Prosperity papers and share your own ideas, visit our site.
Instead of grants and handouts to the politically connected, I believe tax cuts create jobs. This idea is central to An Agenda for Growth. Tax cuts spur economic activity and expand the economy wherever they're tried. The result is more government revenue, not less.
Here in Ontario, this was our experience. I'm proud to have been part of a government that substantially cut taxes on both people and businesses and carried through other pro-growth policies like balancing the budget and eliminating smothering red tape. The result was over a million net new jobs, credit rating upgrades and a 35 per cent increase in tax revenues.
I can tell you from talking to people and businesses during my town halls and the For Jobs and Our Economy tour across the province, there's a consensus taxes must be lower in Ontario.
Tax cuts lead to more tax revenue, not less, while increasing taxes or cancelling a proposed tax cut often leads to far less revenue than expected. As an example, let's take business taxes.
When the Ministry of Finance talks about the "cost" of a proposed tax cut, it accounts for this on a line-item basis by forecasting business profits and then multiplying these by the change in tax rate. The "cost" is another way of saying "revenue loss." It assumes income is stagnant and that it doesn't change as a result of the tax cut, which is what economists call profit shifting.
For example, being sensitive to tax rates, a global corporation might shift operations elsewhere in response to a tax increase, or a local business might scale back expansions and hiring. And while economists argue about the degree of profit shifting that takes place, there's a consensus that higher taxes hold back jobs and growth, and government tax revenue as a result.
When internationally respected economist Jack Mintz of the University of Calgary looked at Ontario's business tax levels, he wrote a Financial Post editorial arguing that while the Liberals claimed the scheduled tax cut from 11.5 to 10 per cent would "cost" $700 million, they ignored $600 million worth of new economic activity that would be generated from this much needed relief.
Why would Professor Mintz say the tax cut cost $100 million and Ministry of Finance say $700 million? It's because you have to account for the economic activity induced by the tax cut, and the effect on government revenues over the long term.
Tax relief creates jobs, grows the economy, and stimulates new business investments. This means more jobs for the unemployed, a rising standard of living and increased tax revenue for the provincial treasury.
Put simply, cutting taxes helps clear the path to economic prosperity.
please take a look at the largest economy in the world. The USA. They have tried this "tax cut economics" for the past 50 years. The economic situation they are currently in is 100% because of this line of economic thinking. It may look good in the short term, but IT IS NOT SUSTAINABLE, and will only serve to put more of my money in the pockets of non-value added bankers and corporate owners.
Your inability to factor in the desperate and unabashed manufactured need for continuous growth by the 1% and their yes men is what confuses you into thinking this is a good idea.
A tax cut = higher revenues for business. The rate at the revenue increases is NOT directly equal to the increase in economic activity.
An over simplified example: if a company receives enough tax break to higher 2 people, it will higher 1 and pocket the rest. They then increase their "growth" and pocket that revenue as well. The war right wing politics has waged on union's has made sure of this.
You are delusional beyond any level of confidence if you believe tax cuts alone (without further government regulation) will make my life in the middle class any better.
This reason alone I will never vote for you or your party.
The US has some of the lowest tax rates in almost 100 years and they're CERTAINLY no better off than they were in the 1950s when the tax rate was somewhere around 90%. Trickle down has been proven NOT to work.
Worked in the past, will work again.
Puts more money back in the pockets of the citizens and not in the hands of the overspending out of touch politicians.
And for those that wish to compare this with the US, sorry, but that is the old adage of apples and oranges.No comparison whatsoever. Different set of cerecumstances. These tax cuts are not for the ultra rich. And this can not be remotely compared to George W Bush's policy. That only benifeted the extremely rich in the US, not the average citizen.
And if this last Lib government had been better money managers, we wouldn't have billions and billions of dollars wasted on E-Health, Ornge, the Green Energy plan (scam), imposed wage settlements leading to labour strife etc., and be second last on lists, beating only the smallest province, PEI.
Personal tax cuts; ie GST reduction. I am yet to see an actual benefit in my personal (middle class) finances from this cut. I do however see a huge deficit in the Federal Government budget directly related to the amount of loss associated with the tax cut.
Corporate Tax cuts:
The amount reduced in this cut is nowhere even close to being equal to the benefit to the economy. Hence the statement it worked in the past it will work again. Well if it worked in the past, why hasn't the benefit continued. Because tax cut economic strategies are a very short term solution, until the corporate world has taken full advantage of them and they are no longer relevant due to the direct social repercussions.
I'm sorry but Baby Boomer based economics will only negatively affect me and my children. I want somthing that will sustain my economy.
And I see savings every time I purchase something after the reductiuon in GST. Sorry you don't. Unfortunately it is somewhat offset by the introduction of the HST here in Ontario
And the feds are trying to reduce their spending to eliminate the defict.
Which was increased by the bail outs when the engineered market meltdown occured in 2008.
And the subject was provincial reductions, not federal , like the GST .
Furthermore, corporations are only taxed at 15% whereas individuals pay a much higher income tax rate. Income from corporate income tax could go a long way to helping the government balance their budget. Instead, a large portion of corporate profit gets redistributed from the pockets of consumers into private profits. Some of this money is removed from the Canadian economy completely by being sheltered in tax havens. Some of it lines the pockets of the wealthy elite, contributing to the growing income gap between the rich and the poor. Tax cuts help rich people and the corporate bottom line.
Reduce the tax on product and services... and people will be less likely to buy from the black market...
The real question is how we want to balance taxes, debt and government spending.
There's no evidence to suggest that's true. The US has had tax cuts for the wealthy in effect for almost a decade no, and job growth is anemic at best.
And the only people who benefit from corporate tax cuts are shareholders who get bigger dividends, and chief executives who get artificially inflated bonuses.
That's why conservatives love that lie so much. But it just isn't true.
This statement is absurd on its face. If we follow this simplistic statement to its natural conclusion, then we should continue cutting taxes until they are zero. Accordingly to your claim, a 0% tax rate will maximize tax revenue.
This, of course, is nonsense. If taxes are too high, then cutting them to a point will increase revenue. But cutting them further will decrease it again. You haven't made any attempt to explain where that point is. You simply take as a given that cutting taxes always increases revenue, which I've already pointed out is just plain wrong.
I also wish you would stop talking about revenue increases in absolute terms. It's not relevant. Over time, population and economic growth and inflation will all increase revenues in pure dollar terms, even if we do nothing to the tax rate. The statistic you should be talking about is revenue per capita (adjusted for inflation).
While no one likes to pay taxes, they provide the revenue for various services throughout the province. While there is no doubt that all Gov't can be more efficient & less wasteful regardless of party affiliation, the selling of tax cuts as an engine for growth is far too simplistic & not based in reality.
In the previous Harris Gov't & in the current Federal Gov't, cutting taxes strips away services at the expense of the most vulnerable. The lure of business tax cuts have long been suggested to be a magic wand for growth but history has shown that businesses do not necessarily increase jobs with those cuts - in fact, most times, they do not.
During uncertain times with the current world economy, now is not the time for massive tax cuts. People are needing more from their Gov't now more than ever. To suggest tax cuts is both irresponsible & typical of the cpc mantra.
That is not to say that Ontario should not get it's financial house in order; it should. I am confident that a streamlining of inefficiencies could cut 10% from our budget but our goal should be long term, not short term.
The cpc approach smacks of Reaganomics with all it "wonderful" trickle down effects - emphasis on the trickle.
No, a more pragmatic approach that delicately works within our current economic situation and the reality of the challenges of most people in Ont.
Our experience here in America has been very different. Tax savings to our very wealthy are squired away in overseas bank accounts leaving us with a diminished amount of money circulating in our economy. It’s really hard to recover with tax cuts chopping away at our roots.