Tax cuts for corporations leave families flailing, Ontario NDP leader says

TORONTO – Ontario New Democrats would scrap corporate tax cuts if elected to run the province, leader Andrea Horwath said Thursday in her first major policy announcement ahead of the fall election.

“This tax cut is not creating jobs, we need to set better priorities,” Horwath said during a speech at a Canadian Union of Public Employees convention.

“That’s why I’m committing today that as premier, I would cancel the Liberal corporate tax giveaway.”

The New Democrats would restore a 14 per cent corporate tax rate, reversing a plan by the governing Liberals to slash those rates to 10 per cent. It’s a plan that wouldn’t apply to small businesses or manufacturers, and the New Democrats say it would put an additional $1.8 billion a year into provincial coffers by 2013.

The change is needed, Horwath said, because those lower rates do nothing to help families struggling to make ends meet, and have failed to create jobs or encourage more investment.

“The reality is the competing jurisdictions are around the same as us, if not higher than us already, so I don’t think it’s true that it makes us uncompetitive, and the evidence is very clear that across the board corporate tax cuts haven’t created jobs,” she said.

“The sector that got the lion’s share of corporate tax cuts, the financial sector, has 25,000 people fewer than they had before those cuts.”

Part of the money saved through the change would be used to make up the shortfall of eliminating the HST from hydro and home heating bills, something the NDP promised long before the Progressive Conservatives introduced it as a campaign promise last week.

Horwath’s announcement came as PC Leader Tim Hudak pledged to put prisoners to work cleaning graffiti and raking leaves along highways and in cities if he forms the next government.

Hudak has also said he’d boost spending on health care by $6.1 billion over four years, as well as shut down the province’s 14 local health integration networks and the Ontario Power Authority.

The Tory leader also vowed to scrap the Liberal government’s $7-billion green energy deal with South Korean giant Samsung and to stop offering huge premiums for wind and solar power.

Horwath has yet to release her party’s platform, and wouldn’t say Thursday if it will include any more tax hikes.

“When it comes to taxes, that’s our big issue _ that the corporate tax giveaways have left families hurting,” she said.

Transportation Minister Kathleen Wynne warned that raising corporate taxes would create “a chill in the job increases we’ve seen,” arguing that lower taxes have created jobs, especially in the manufacturing sector.

“We know that corporations look for favourable tax regimes,” Wynne said.

“It’s working, we’re seeing the jobs coming back to the province.”

Progressive Conservative finance critic Norm Miller said enough jobs had been lost in Ontario after the Liberals raised corporate taxes to 14 per cent when they were elected in 2003, adding the last thing businesses need after a recession is a tax increase.

“Nothing hurts job creation more than raising corporate taxes,” Miller said.