How will the newly elected Ontario PC Government affect your pocket-book? - Kerr Financial
Financial Planning
How will the newly elected Ontario PC Government affect your pocket-book?
Category: Financial Planning Tags: Doug Ford, Ontario budget, Ontario Tax Changes, PC Campaign promises, PC party

Although it is early days since Doug Ford and the PC Party were voted in with a resounding majority on June 7th, there were some significant commitments in the election platform.  Regardless of your politics, the proposals could impact your pocket-book if enacted.

One of the key promises was the commitment to reduce the cost of your hydro bill.  Specifically, in addition to the promise to ‘Fire the $6 million dollar man’ at the head of Hydro One, the PC party promised to lower hydro bills by 12%.   The reduction of hydro, would arguably affect all Ontario families and is estimated to add on average another $176/year to your pocket book.

In regards to Ontario tax changes, Doug Ford made quite a few promises that if enacted could affect both individuals as well as Ontario corporations. However, before spending any additional funds, keep in mind that in addition to being ‘campaign promises’ some of the commitments are only planned for the 2nd and 3rd years of his mandate.  So we will all have to wait and see what changes are enacted in the next Ontario budget before spending any additional funds!

In the meantime – here are a few of the more significant commitments made with regards to Ontario taxes:

For individuals

• The PC party pledged to provide a 20 per cent reduction in the rate of the province’s second tax bracket.  This change would save income earners as much as $786/year. But don’t go spending the extra funds yet, as this change is only targeted to be implemented in the third and fourth years of his mandate.

• They also committed to creating a new 75% refundable tax credit for child care costs for children aged 0 – 15 while giving parents a choice of what kind of child care is best for their kids. No specific timing was indicated with this particular pledge.

For Corporations

• The PC party also made a pledge to reduce the Ontario corporate tax rate to 10.5% from its current 11.5%, and the small business tax rate to 3.2% per cent from 3.5% per cent.  If enacted, both would only begin in the second year of his mandate.

Other

• Another major campaign pledge by the PC Government is to scrap the Carbon Tax and cancel the cap-and-trade slush fund. Although the PC government is not set to transition until the end of June, certain programs have already been affected.  The changes include the cancellation of rebates on windows, solar, ground source heat pumps and insulation. If you were counting on the $5,000 rebate from the installation of windows, you should confirm the timing of their installation as the P.C. government set a deadline of August 31, 2018 for the installation  to be  completed, in order to be eligible for the rebate.

Campaign promises can fall short once the reality of the situation is understood; in the meantime Kerr Financial will be on top of the changes that may affect your pocket-book!


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