In the wake of the 2012 Ontario budget, the Ontario Chamber of Commerce (OCC) has called for a two-pronged approach to balancing the books: deficit reduction and a clear focus on growth and transforming the Ontario economy for the 21st century.
The OCC recognizes that the 2012 Ontario Budget made difficult choices. The budget’s main focus on reducing the deficit is certainly the top priority for Ontario businesses. But to lay the groundwork for future growth and prosperity, Ontario needs an economic vision. The OCC is calling on the government to make Ontario more productive, more competitive and more global by fostering innovation, building a 21st century workforce, achieving fiscal balance, taking advantage of global opportunities, and identifying our competitive advantages.
A significant part our global competitiveness is the provincial tax environment. While the OCC was expecting a delay in the corporate income tax (CIT) reduction, we expect the Government will meet its deficit reduction targets and implement the CIT reductions in 2017-18, or earlier.
The budget acted on some of the Ontario business community’s priorities. The budget tackles rising labour costs in the public sector. The OCC has been pressuring the government to develop a long-term public sector restraint strategy that would allow the province to regain its fiscal flexibility.
The budget also brought pension relief for employers. Budget 2012 extends temporary solvency funding relief for private-sector pension plans and will introduce regulations that would permit employers to use letters of credit to cover up to 15 percent of pension plans’ solvency liabilities. The OCC has been calling on the government to ease the short-term pension funding pressure that is hurting Ontario’s businesses.
The OCC will work continue to work cooperatively with the provincial government to make Ontario more competitive and prosperous.