CTF 2005/06 Prebudget Submission

TORONTO: At 9:30 this morning the Canadian Taxpayers Federation (CTF) Ontario Division presented its 2005/2006 Pre-Budget Submission to the Standing Committee on Finance and Economic Affairs. Entitled "Making Government Work: From fiscal fairness to smarter spending, a plan of action for Ontario", the submission makes eight recommendations which include:

1. That the government eliminate the provincial Health Tax and hold the line on other taxes. The Health Tax has effectively erased all gains by middle-income tax payers since 1999. It is adversely affecting the economy by dampening consumer spending. The Health Tax could be cut by two-thirds without reducing services if the government combined new federal funding on health care with reforms similar to those enacted by the Liberal government in British Columbia. This would involve outsourcing hospital services and increasing private health care delivery. The government should also reduce education spending on school boards, which currently stands at $10 billion a year. Such reductions should be administrative and not impact services to students.

2. That the government stop running deficits and spend smarter. Currently, the McGuinty government will increase the provincial debt by $12 billion over its mandate, wasting $4.4 billion on interest payments. This takes money away from services. The government should make every effort to root out waste and review spending on public sector salaries. It should rebalance the roles of the public and private sector, privatizing services where these can be more cost-effectively delivered by non-governmental workers (in the energy and health sectors) and divest itself of Crown corporations such as the LCBO, with proceeds going to reduce the public debt.

3. That the government reform the property tax system. Property taxes have skyrocketed in parts of Ontario and the Current Value Assessment system is not working. The government should implement a simpler, fairer, unit-based assessment system which removes reassessment and includes a tax cap. Discrepancies between property taxes in many areas of Ontario must be addressed with a link to services provided.

"Premier Dalton McGuinty's government is currently spending at the same level as the government of NDP Premier Bob Rae - who indebted this province to the tune of $66 billion," commented Ontario Director Tasha Kheiriddin. "Mr. McGuinty must be reminded of his signed election commitment to hold the line on taxes and not run deficits. He should eliminate the Health Tax by reforming service delivery, reducing spending, and spending smarter within the government's means."

A full copy of the submission can be accessed at /media/downloadable/80.pdf