SIMCOE – Ontario’s provincial budget introduced several tax cuts and other measures designed to provide business relief.

The government is planning to invest $4.8 billion in initiatives that will support jobs now, while removing barriers that would hold Ontario back from a strong recovery from COVID-19. Among the major initiatives proposed by the government are a reduction of job-killing electricity prices, reducing taxes on jobs, connecting unserved and underserved communities with a historic investment in broadband infrastructure, and providing workers with skills training — including those impacted by the pandemic, such as tourism and hospitality workers — to help them connect to jobs needing high-demand skills.

The government is also acting immediately to reduce taxes for job creators and level the playing field by lowering high provincial business property tax rates to a rate of 0.88 per cent for over 200,000 properties — or 94 per cent of all business properties in the province. This would create $450 million in annual savings in 2021, representing a 30 per cent reduction for many employers.

Ontario is going a step further to make available additional support for the employers most affected by COVID-19. The government has heard from some municipalities that they would like additional tools to provide more targeted tax relief to job creators in their community. Ontario is responding to requests from local governments by proposing to provide municipalities with the ability to cut property tax for small businesses and a provincial commitment to consider matching these reductions. This would provide small businesses as much as $385 million in total municipal and provincial property tax relief by 2022-23, depending on municipal adoption.

The province is also ending a tax on jobs for an additional 30,000 employers by proposing to make permanent the Employer Health Tax (EHT) exemption increase from $490,000 to $1 million. This would save private-sector employers $360 million in 2021-22 that could be reinvested in jobs and growth. About 90 per cent of employers would pay no EHT with this additional relief.

When employers are looking at Ontario as a place to do business, it’s clear the province’s high commercial and industrial electricity prices are a barrier to investment that causes some of them to go elsewhere. The 2020 Budgetoutlines a plan to reduce the burden on employers of Ontario’s high-cost contracts with non-hydro renewable energy producers, which will be wound down once and for all. Starting on January 1, 2021, a portion of the cost of these contracts, entered under the previous government, will be funded by the Province, not the ratepayers. This electricity cost relief would free up money that could be better spent creating jobs. Medium-size and larger industrial/commercial employers would save about 14 and 16 per cent respectively, on average, on their bills starting in 2021. This means Ontario will go from having some of the least competitive electricity prices to prices that are more competitive than the average in the United States.

“These measures, along with the huge investment in rural broadband announced earlier in the week, are part of our plan to revitalize Ontario’s economy coming out of COVID,” said Haldimand-Norfolk MPP Toby Barrett.

Additional measures

Small and main street businesses are the backbone of Ontario’s economy. They sustain thriving communities, support supply chains and connect regional economies. Many of them grow into the game-changing companies Ontario is known for worldwide. This is why their recovery is so critical to Ontario’s recovery, and that’s why the government is supporting employers and protecting jobs by: 

·    Committing to provide eligible businesses in areas with modified Stage 2 public health restrictions, or, going forward, areas categorized as Control or Lockdown, with up to $300 million to cover costs associated with property taxes and energy bills.

·    Providing $60 million in one-time grants of up to $1,000 for eligible main street small businesses — in retail, food and accommodations, and other service sectors with fewer than 10 employees — to help offset the unexpected costs of personal protective equipment PPE.

·    Helping small business tenants who continue to need support by proposing to further extend the temporary ban on evictions for commercial tenants who would have been eligible for the Canada Emergency Commercial Rent Assistance (CECRA) for small businesses.

·    Helping Indigenous communities and Northern municipalities by reinforcing the commitment to resource revenue sharing including exploring sharing revenues from aggregates development, forestry and mining with more Indigenous partners and Northern municipalities.

·    Providing up to $10 million to support Indigenous-owned small- and medium-sized enterprises experiencing revenue shortfalls and unique challenges during COVID-19. 

·    Providing an additional $1.8 billion in the Support for People and Jobs Fund over the next two years, 
2021–22 and 2022–23, to remain responsive to emerging needs and continue providing supports for the people of Ontario.

For more information, contact MPP Toby Barrett at 519-428-0446 or toby.barrett@pc.ola.org