The Canadian Press - ONLINE EDITION

Wynne ignores bureaucrats' warning that new payroll taxes will cost jobs: Tories

  • Print

TORONTO - By pushing ahead with an Ontario pension plan, Premier Kathleen Wynne is ignoring warnings from her own finance officials that adding new payroll taxes will kill jobs, the Progressive Conservatives charged Tuesday.

They said the evidence can be found in a government document — dated last February — that explores the economic impact of various so-called "revenue tools" to pay for a massive expansion of public transit in the Toronto-Hamilton area.

Any increase in payroll taxes would have the "largest negative impact" on employment, the document said.

It would result in lower business investment, relocation of business to other jurisdictions, reduced work effort and "out-migration of people" over the long term, it said.

It also estimates that raising $2 billion annually over 10 years by increasing payroll taxes for transit would cost 18,000 jobs.

The governing Liberals should take the advice to heart as they prepare to launch a provincial pension plan in Thursday's budget, the Tories said.

The Ontario Retirement Pension Plan will increase payroll taxes, which means employers won't have the money to hire more people and workers will have less take-home pay, said Tory finance critic Vic Fedeli.

"This isn't government money going in to pay for this program," he said.

Wynne dismissed the document, saying it has nothing to do with the proposed pension plan. Contributions to a pension plan aren't taxes either because they don't go into the provincial treasury, she said.

"We know that there is not enough saving that people are capable of, that people are at risk of struggling in their retirement," Wynne said in the legislature.

"So we are going to bring a plan that will allow people to have that retirement security."

Her government has already lowered payroll taxes by reducing the employee health tax for smaller businesses to help create jobs, she added.

Wynne can't have it both ways, said Opposition Leader Tim Hudak.

"So which is it, premier? Do you believe that lowering payroll taxes creates jobs, or do you believe increasing payroll taxes creates jobs?" he said. "Honest to goodness, you look like (former premier) Dalton McGuinty."

It's true that people aren't saving enough for retirement, but that's because they're struggling to find work, Hudak said.

"It's hard to put money aside for a pension when you can't pay the hydro bill," he told reporters.

"If you're struggling to get by on a part-time job, you don't have money for savings. And if you have no job at all, you don't have a pension."

The Canadian Federation of Independent Business has also voiced concern about a provincial pension plan, saying it would be a financial strain on both employers and workers.

The Canada Pension Plan's maximum yearly premiums of about $4,700 are split between contributing workers and employers; the self-employed pay the full amount.

The Liberals say they have to take action to improve retirement savings because the federal Conservatives have refused to enhance the CPP, which provides a maximum of about $12,500 a year.

About 40 per cent of Ontarians have no pension and must rely on CPP benefits, said Eric Hoskins, minister of economic development, trade and employment.

Prince Edward Island and Manitoba have also joined Ontario to explore options to enhance retirement income.

"We're not talking about additional taxes, we're talking about enhanced, greater retirement savings for our seniors," he said.

The document, which was provided to an all-party legislative committee, also provides insight into what new levies the minority Liberals may unveil in the budget to build public transit.

While any tax increases would have negative long-term consequences on the economy and employment, the document says raising fuel taxes and fees for using roads would have the smallest impact.

But charging motorists for every kilometre travelled within a certain area could cost about 5,000 jobs over 10 years, it said. The outcome would be the same if fuel taxes were increased.

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Keri Latimer looks for beauty in the dark and the spaces between the notes

View more like this

Photo Store Gallery

  • MIKE APORIUS/WINNIPEG FREE PRESS STANDUP - pretty sunflower in field off HWY 206 near Bird's Hill Park Thursday August 09/2007
  • Young goslings jostle for position to take a drink from a puddle in Brookside Cemetery Thursday morning- Day 23– June 14, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

Which of Manitoba's new landlord-tenant rules are you looking forward to most?

View Results

View Related Story

Ads by Google