Affordability is the elephant in the room as Ontario approaches this June’s provincial election and it’s time for Ontario’s politicians to address it before they get trampled.
All three of Ontario’s major political parties plan to speak to the issue of affordability in their platforms. The Ford government has been busy eliminating user fees for taxpayers. Steven Del Duca’s Liberals are promising thousands of dollars in electric car rebates. And Andrea Horwath’s NDP is talking about billions of dollars to build more affordable housing.
Every party will try to put an affordability dog in the window just in time for the election. But the best way to help Ontarians is to leave more money in taxpayers’ pockets on payday.
In Ontario, inflation is rising at more than double the rate of wage growth. That means that any gains taxpayers are making through pay hikes at work are being entirely eaten away by rising prices, and then some.
Taxpayers’ purchasing power is declining at a rate not seen since Cheers was the most-watched show on television.
Thanks to rampant inflation, Ontarians are falling further and further behind. Experts have projected that Ontario families will pay, on average, an additional $1,000 this year on groceries compared to last year. Gas prices are up by over 33 per cent compared to just one year ago. The average rental rate for an apartment in Toronto has surged by 16 per cent over the past twelve months. Three bedroom units are renting for about $2,700 per month.
Ontarians need relief, and they need it urgently.
Four years ago, Ontario Premier Doug Ford ran on a platform of affordability and tax relief. His most significant promise was to reduce middle-class income taxes by up to $1,700 a year for a family with two income-earners.
Ford’s promise tried to address the problem at its source. Rather than offering vague promises to help deal with specific issues that might impact some families more than others, Ford adopted an across-the-board approach, proposing a tax cut that could help millions of families across Ontario.
While the Ford government is now talking about leaving more money in Ontarians’ pockets through eliminating certain road tolls and scrapping the province’s license plate sticker fees, the relief Ontario families would feel if the Ford government delivered on its four-year-old income tax cut commitment would far outstrip the government’s move to reduce the number of fees taxpayers are forced to pay.
As Ontario’s 2022 election campaign is set to begin in a matter of weeks, affordability should be at the top of the agenda. But Ontario taxpayers don’t want to see election gimmicks that would only help a small portion of taxpayers or pie in the sky promises that will never be acted upon. Ontarians want to see a real plan to increase the size of paycheques. The best way to get there is broad-based income tax relief.
Ontarians haven’t seen an income tax cut since former premier Mike Harris introduced sweeping tax relief in the mid-1990s. When Harris slashed income taxes, Ontario had the lowest income tax rates in the country. Since then, provinces like British Columbia and Alberta have outstripped Ontario in tax competitiveness. Even Canada’s territories have lower income taxes.
It’s time to make Ontario a leader again. To increase the size of Ontario’s paycheques and boost purchasing power, Ontario’s political parties should present a comprehensive plan to deliver on income tax relief. Ontario’s politicians should forget the election gimmicks and offer a clear path toward larger paycheques.
Jay Goldberg is the Ontario Director at the Canadian Taxpayers Federation