This package moves forward on the government's five-point plan for economic competitiveness and will particularly help people and communities facing economic challenges. "The Ontario economy has proven resilient in an increasingly challenging global economic environment. However, certain key sectors, such as manufacturing, forestry, agriculture and tourism, face serious challenges,"said Finance Minister Dwight Duncan. "We are helping these sectors adjust to a changed economic environment." Ontario's economy has been challenged by external factors, including aslowing U.S. economy, record-high oil prices and a stronger Canadian dollar. In response, the McGuinty government proposes a package of tax measures andinfrastructure investments to enhance competitiveness, strengthen Ontario'scommunities and create jobs.
In the 2007 Economic Outlook and Fiscal Review released today, the government is proposing $1.1 billion in tax reductions for business over three years that would support manufacturers and other sectors, including:
- eliminating the Capital Tax on January 1, 2008 for corporations primarily engaged in manufacturing and resource activities;
- providing a 21 per cent Capital Tax rate cut for all businesses retroactive to January 1, 2007, on the way to full elimination in 2010;
- increasing the small business deduction threshold to $500,000 from $400,000 - retroactive to January 1, 2007. The package introduced today would also provide:
- $1.4 billion in new funding to build strategic infrastructure;
- almost $300 million over three years to expand the Land Transfer Tax Refund Program for First-time Homebuyers to include purchases of resale homes;
- $150 million to strengthen competitiveness and help cattle, hog and horticulture farmers;
- $50 million in strategic investments in innovation;
- $40 million to provide skills development and rapid re-employment services for laid-off workers through the $1-billion Employment Ontario training system;
- $30 million to expand the Ministry of Tourism's successful festivals and events promotion and marketing campaign in the domestic and international markets.
In spite of external factors, the Economic Outlook indicates Ontario'seconomy is on track to outperform the 2007 Ontario Budget forecast. Ontario's continued economic strength allows the government theflexibility to implement targeted measures, particularly for manufacturers,and to invest in our communities through improved infrastructure. Despite inheriting a structural deficit of $5.5 billion in 2003-04, theEconomic Outlook confirms that the Province's budget is balanced. If thereserve is not required, a $750 million surplus is projected for 2007-08. Despite weaker projections for economic growth in 2008 and 2009, Ontario is ontrack for continued balanced budgets. "The people of Ontario want us to be prudent fiscal managers and to pursuereal progress at the same time," said Duncan. "The people of Ontario are counting on us to move Ontario forward. That is what our plan is about."
News Release December 13, 2007 Government of Ontario Ministry of Finance
ONTARIO EXPANDS LAND TRANSFER TAX REFUND PROGRAM
First-time buyers of resale homes to benefit from new tax measure
The McGuinty government is giving all first-time homebuyers a break on land transfer tax by proposing to expand the Land Transfer Tax Refund Program to include purchases of resale homes, Finance Minister Dwight Duncan announced today.
"Expanding this Land Transfer Tax refund is an important part of our government's commitment to helping Ontarians buying their first home," Duncan said.
Effective midnight tonight, first-time buyers of resale homes, as well as newly constructed homes, would be eligible for a refund from the provincial government of up to $2,000 of the Land Transfer Tax paid.
The expanded Land Transfer Tax Refund Program for First-time Homebuyers is part of a package of new tax initiatives announced in the 2007 Fall Economic Outlook and Fiscal Review that would provide $1.4 billion in provincial tax relief for business and people over three years. The government is making strategic investments in people, communities and infrastructure to strengthen Ontario's economic advantage and help manufacturers and other sectors challenged by current economic conditions.
For more information please visit: http://www.gov.on.ca