Tax alert

2022 Ontario Election: A comparison of the parties’ proposals

May 18, 2022
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On June 2, 2022, Ontarians will head to the polls to either re-elect Premier Doug Ford or elect a new Premier. As part of their election campaigns, the various parties propose a myriad of tax measures. This article summarizes the parties’ proposed tax measures.

Progressive Conservative Party of Ontario 

The Progressive Conservative (PC) Party of Ontario, led by incumbent Doug Ford, tabled the 2022 Budget, entitled Ontario’s Plan to Build. The document serves both as a provincial budget and an election platform for the PC party.

The key business tax measures are:

  1. Extending the 10% increase to the Regional Opportunities Investment Tax Credit to Jan. 1, 2024.
  2. Enhancing the various film and television tax credits and updating the Ontario Book Publishing Tax Credit.

The key individual tax measures are:

  1. Expanding the Low-Income Individuals and Families Tax (LIFT) Credit.
  2. Creating a refundable Ontario Seniors Care at Home Tax Credit to reimburse a portion of medical expenditures for low- to moderate-income earning Ontarians who are 70 years of age or older.
  3. Increasing the Non-Resident Speculation Tax (on the purchase of residential property by individuals who are not citizens or permanent residents of Canada) from 15% to 20%.

Ontario Liberal Party 

The Liberal Party, led by Steven Del Duca, released its platform focusing on rebuilding Ontario through investments in education, health care and public services that support working families. 

The key business tax measures are:

  1. Introducing a 1% surtax on corporate profit above $1 billion.
  2. Providing businesses up to $200 a day to compensate for the costs of workers taking sick days.
  3. Eliminating corporate taxes for two years for small businesses affected by the pandemic, with relief scaled in accordance with losses in revenues due to the pandemic.
  4. Eliminating incorporation fees for new business start-ups.
  5. Introducing a ‘use it or lose it’ tax on developers sitting on land ready for development.

The key individual tax measures are:

  1. Implementing $10 per day childcare by September 2022 and providing retroactive payments of $2,750 per child.
  2. Introducing a 2% income tax increase on individuals earning over $500,000 annually.
  3. Introducing an empty-homes tax of 2% on the assessed value of homes owned by Canadian owners, and a more-onerous tax of 5% on the assessed value of homes owned by non-Canadian owners.
  4. Banning new non-resident ownership of homes, combating money laundering in the housing market and ensuring condo flippers pay appropriate taxes.
  5. Increasing Old Age Security by $1,000 per year for eligible seniors and increase Ontario Disability Support Program (ODSP) and Ontario Works (OW) rates by 10%, followed by another 10% for ODSP recipients in 2023.
  6. Providing up to $9,500 in rebates on electric vehicles and charging equipment

Ontario New Democratic Party

The Ontario New Democratic Party, led by Andrea Horwath, released its platform focusing on making life more affordable, fixing the health care system and schools and strengthening equity. 

The key business tax measures are:

  1. Ensuring big corporations pay their fair share of taxes.
  2. Introducing two more rounds of the Small Business Recovery Grant in 2022 and 2023.
  3. Launching a COVID-19 emergency business fund for Black-owned small businesses and entrepreneurs and others who have faced systemic barriers. 
  4. Providing financial support to non-profits and charities disproportionately impacted by the pandemic.
  5. Providing a second round of the Tourism Recovery Program to help businesses recover. 
  6. Improving the Ontario Computer Animation and Special Effects Tax Credit & other film and TV tax credits.

The key individual tax measures are:

  1. Freezing taxes for low- and middle-income families while taxing high-income earners.
  2. Maintaining the Non-Resident Speculation Tax (on the purchase of residential property by individuals who are not citizens or permanent residents of Canada) at 20% percent and closing perceived loopholes. 
  3. Introducing an annual speculation and vacancy tax on residential property modeled off British Columbia’s tax that will apply to all speculators who own unoccupied houses.
  4. Accelerating the implementation of $10 per day childcare.
  5. Extending the Staycation Tax Credit by another two years.
  6. Providing incentives of up to $10,000 to Ontarians who purchase zero-emission vehicles, excluding luxury vehicles.

Green Party of Ontario

The Green Party of Ontario, led by Mike Schreiner, released its platform and focuses on a caring society, connected communities and climate economy.

The key business tax measures are:

  1. Cracking down on money laundering and implementing a beneficial ownership registry to improve transparency regarding property ownership.
  2. Implementing a database that tracks pre-construction condo sales requiring developers to collect and report comprehensive information about buyers to ensure compliance.
  3. Expanding the Digital Main Street program to include nonprofit organizations and provide fulfilment platforms that better enable small, local businesses to compete with large online companies.
  4. Developing a small business grant program for Black-owned businesses.
  5. Developing a program to help COVID-affected small businesses file for bankruptcy in a non-punitive way.

The key individual tax measures are:

  1. Phasing in a basic income, double ODSP and OW rates and reduce aggressive clawbacks.
  2. Implementing a multiple property speculation tax on people and corporations who own more than two houses or condominium units in Ontario at a rate of 20% on the third home, with increases for each additional property owned.
  3. Implementing a province-wide vacant homes tax.
  4. Implementing an anti-flipping tax on quick turnaround sales.
  5. Supporting the increased Staycation Tax Credit and ensure it includes dining at restaurants.
  6. Increasing demand for new low-emission vehicles with cash incentives up to $10,000 for buying a fully electric vehicle and $1,000 for an e-bike or used electric vehicle.

Key takeaways

Despite the different election platforms from the various parties, there is a clear theme in some of the tax measures: specifically, all parties appear to be targeting non-resident home ownership. Many of the other tax proposals are short on details, leaving voters somewhat unclear on how these proposed measures would work in practice.

RSM contributors

  • Yoni Moussadji
    Senior Manager
  • Sigita Bersenas
    Associate
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