Tax Cuts are a Bandaid Solution to a Gaping Wound
The Liberal majority government of Ontario, lead by McGuinty with Dwight Duncan as Minister of Finance have released the annual budget for the province, at a time when it is becoming apparent that the fall out from the credit crisis (sub prime and all that jazz) in the US is affecting us north of the border. We have been alerted to the fact that we may face a recession.
Even with that sword hanging over our heads, the government released a progressive budget that significantly strayed from the “advice” of heavily despised former Ontario Minister of Finance, Jim “the tax slasher” Flaherty and his audacious suggestion to “cut taxes” despite that doing so at the federal level proved to be a massive set back for the Canadian economy.
Flaherty and Harper have led a dual-pronged attack on the liberal province of Ontario because of the refusal to cut business taxes, claiming that it is a magical solution that will ’stimulate’ the ailing economy. Of course, anyone here knows that it’s a bunch of conservative tripe and that Flaherty is a remnant of the Harris ‘Common Sense Era’ that saw the destruction of key social services, including and not limited to education.
Refusing the “sagely advice” of the federal government (and it’s willingness to treat Ontario as a cancerous growth on the backside of Canada), Duncan released the budget with no tax cuts in it. Instead, to help our economy, he included money to invest in labour retraining, to help those get a new trade if they are unable to find work with their skills.
Other keys areas include ageing and crumbling infrastructure (also a key to the economy; smooth roads make it easier to truck in goods, for example), and the environment, something that we need for the future.
“This Budget is about making sure people have jobs and Ontario’s economy grows,” said Finance Minister Dwight Duncan.
“This Budget is about ensuring that all Ontarians have the opportunities and skills to succeed, so that they are working in jobs that will strengthen Ontario’s economy.”
“This Budget is investing in infrastructure such as roads and public transit, which creates jobs in the short term and strengthens our economy in the long term.”
The budget had its focus on education, as well as the economy. Education is one key part given that it is instrumental in developing a skilled, competent workforce that is highly competitive and can bring the economy back to its feet.
Here are some of the highlights from the provincial budget for 2008…
EDUCATION (including post secondary)
- $18.8 billion towards grants for school boards in 2008–09, a 20 per cent increase since 2003–04
- $9,821 in 2008–09 in average per-student funding, a 24 per cent increase since 2003–04
- More funding for literacy programs and for children with special education needs.
- $135 million over three years to provide dental services to low-income families
- $32 million over three years for the Student Nutrition Program, doubling its annual funding
- $1 billion over five years for a proposed new property tax grant of up to $500 a year for senior homeowners with low and moderate incomes.
ECONOMY
- $1.5 billion, three-year Skills to Jobs Action Plan that will provide new skills for new careers, expand postsecondary student aid and programs, and build places to learn, including:
- $355 million over three years for a Second Career Strategy to help 20,000 unemployed workers get long-term training for new and better careers
- $75 million over three years to increase the number of apprentices.
- $750 million in proposed tax measures over four years to encourage business growth, particularly in the manufacturing and resource sectors
- Proposing a 10-year Ontario income tax exemption for new corporations that commercialize intellectual property developed by qualifying Canadian universities, colleges or research institutes
- Modernizing regulation to reduce the paper burden for Ontario businesses.
- The five-year, $1.15 billion Next Generation of Jobs Fund will help secure new investment and jobs
- The government’s initiatives will help key sectors such as financial services, the entertainment and creative cluster, tourism, manufacturing, mining, forestry and agriculture stay competitive in a rapidly changing global marketplace.
There is more than one way to skin a cat (if you’ll pardon the expression), and our provincial government is showing us that we can help our economy that involves much more than tax cuts. You have to spend money to earn money.
