For immediate release
December 31, 2009
ONTARIO WILL HAVE LOWEST INCOME TAXES
IN CANADA AS OF JANUARY 1st
MERLIN—On New Year’s Day, Ontario will have the lowest income taxes on the first $37,000 earned in the nation, and 93 per cent of all income taxpayers will get a permanent tax cut, said Chatham-Kent-Essex MPP Pat Hoy.
“Starting January 1st, less provincial tax will be taken off your first paycheque of the year, and every paycheque after that. Millions of Ontarians will benefit, but the greatest benefit is, it’s part of a package experts say will create investment and jobs when our province needs it most,” said Hoy. “This is all part of our comprehensive tax plan that will help create 591,000 jobs and make the province more attractive for new business investment.”
“The province is cutting the first income bracket tax rate by one percentage point, from 6.05 per cent to 5.05 per cent—Ontario will have the lowest tax rate of all provinces on the first income bracket, and an additional 90,000 lower income Ontario taxpayers will no longer pay any provincial personal income tax,” said Hoy.
"Our tax changes are about helping Ontario families by creating jobs and putting more money in their pockets through tax breaks and credits. Millions of Ontarians will benefit from our personal income tax cuts, but the greatest benefit to all Ontarians would be the additional jobs created as a result of our tax package," said Revenue Minister John Wilkinson.
The comprehensive package also includes $10.6 billion in direct payments and permanent tax relief, including the following:
• Starting in August, nearly 3 million low- to middle-income Ontario families and individuals will receive a new, permanent Ontario Sales Tax Credit of up to $260 for each adult and child per year—one of the most generous in Canada.
• An additional $270 million in annual property tax relief, through enhancements to the Ontario Property Tax Credit, will benefit 2.3 million low- to middle-income homeowners and tenants; including $625 to allow seniors to stay in their homes longer.
• Starting in June 2010, Sales Tax Transition Benefits will benefit 6.5 million Ontario families and individuals, totaling up to $1,000 for families (including single parents) and up to $300 for single people.
QUICK FACTS
• In November 2009, economist and tax expert Jack Mintz estimated that these tax changes, together with other recent tax measures, will create 591,000 new jobs within ten years.
• About 83 percent of goods and services will see no change as a result of the HST coming into effect on July 1, 2010. In fact, the HST will result in the removal of $4.5 billion a year in hidden sales taxes when fully phased in. This means prices on some items will come down.
• $1,250 = the amount of purchases that every $100 in tax relief will cover the additional HST for (and note that only 17 percent of items will have any additional tax at all); as well, most of those prices won’t go up by a full 8 percent, as business will no longer pay PST on the items they need to do business, driving down their costs. In Quebec and the Atlantic provinces, prices dropped after harmonization of the GST and PST.
• $500 million = the amount businesses will save from only filing one tax.
• For every $1 in tax cuts for small business, there’s $2 in cuts for consumers.
• These tax reforms are not a “tax grab,” as the government will have $3.4 billion in lower revenues as a result of the HST in the first four years alone.
LEARN MORE
• Ontario’s Comprehensive Tax Plan at http://news.ontario.ca/rev/en/2009/12/ontarios-comprehensive-tax-plan.html.
• Find out more about Ontario’s plan: www.rev.gov.on.ca/en/taxchange/index.html.
• View the report “Ontario’s Bold Move to Create Jobs & Growth: www.news.ontario.ca/rev/en/2009/11/report-estimates-benefits-of-ontarios-tax-plan.html.
• See how the HST system removes hidden taxes: www.rev.gov.on.ca/en/taxchange/hiddentax.html.
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Media Contact: Mike Ferguson, 519-351-0510
Public Inquiries
Ontario Budget and HST information
1-800-337-7222
