Income Tax Cut for 93% of Ontario Taxpayers

McGuinty Government’s Tax Changes To Create Jobs, Attract Investment

Starting January 1, 2010, 93 per cent of Ontario income tax payers will get a permanent tax cut, as part of a comprehensive tax plan that will help create 591,000 jobs and make the province more attractive for new business investment.

The province is cutting the first income bracket tax rate by one percentage point, from 6.05 per cent to 5.05 per cent. As a result, Ontario will have the lowest tax rate of all provinces on the first income bracket, and an additional 90,000 lower income Ontario taxpayers will no longer pay any provincial personal income tax.

The comprehensive package also includes $10.6 billion in direct payments and permanent tax relief, including the following:

  • Starting in August, nearly 3 million low- to middle-income Ontario families and individuals will receive a new, permanent Ontario Sales Tax Credit of up to $260 for each adult and child per year – one of the most generous in Canada.
  • An additional $270 million in annual property tax relief, through enhancements to the Ontario Property Tax Credit, will benefit 2.3 million low- to middle-income homeowners and tenants.
  • Starting in June 2010, Sales Tax Transition Benefits will benefit 6.5 million Ontario families and individuals – totalling up to $1,000 for families (including single parents) and up to $300 for single people – in 2010 and 2011.

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Smith touts tax plan

Nipissing MPP Monique Smith issued a media release Tuesday touting the benefits the Ontario Tax Plan for More Jobs and Growth Act, which includes the harmonized sales tax legislation.

If passed, the act will increase business investment, create new jobs and raise incomes for Ontarians, the release said.

The release said along with the proposed harmonized sales tax, 93% of taxpayers will pay less personal income tax, while 90,000 low-income Ontarians will no longer pay provincial personal income tax.

The province is also proposing to almost double the property tax and sales tax credits.

Proposed tax cuts for business would enhance the benefits of the proposed HST by attracting more investment into Ontario, said the release.

The personal income and corporate tax reforms include a 16.5% tax cut on the first $37,106 of taxable income — which would make Ontario’s the lowest personal income tax rate of any province in Canada; an average personal income tax cut of 10% for Ontario families and individuals earning up to $80,000.

The act also includes an 18% tax cut for small businesses and a 17% tax cut for manufacturers.

http://www.nugget.ca/ArticleDisplay.aspx?e=2181618

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