TAX NEWS - June 2010

Ontario Tax: Ontario Tax Plan Creates Jobs In Kitchener-Waterloo

McGuinty Government's Tax Plan Helps Companies Become More Competitive

Ontario's tax plan will help Kitchener-Waterloo's high-tech industry create more jobs and become more competitive in markets around the world.

By modernizing an outdated, 50-year-old tax system, Ontario is cutting taxes for businesses and combining two existing sales taxes into one - the HST. When it begins on July 1, businesses will deal with one sales tax instead of two, one set of rules instead of two and one level of government instead of two. These changes will save businesses more than $500 million a year in administrative and compliance costs alone.

The HST also eliminates hidden taxes on business and makes them more competitive. Ontario products will only be taxed once, at the register, instead of being taxed at various steps throughout production. That will make Ontario businesses more competitive, so they can sell more products to the world. Currently, four provinces and more than 140 other countries have value-added tax systems like the HST.

This message was delivered at The Tannery, the future home of The Communitech Hub. Communitech's programs and services are helping more than 550 regional businesses in the digital media and mobile computing industry, including Desire2Learn and MKS.

Tax expert and economist Jack Mintz says that the tax plan will lead to increased business investment and help create almost 600,000 net new jobs across Ontario. The tax plan is a key component of the five-year Open Ontario plan to grow the economy.


Quick Facts
 
As a result of the HST and business tax cuts, the tax rate on business investments in Ontario will be cut in half, making Ontario one of the most competitive jurisdictions in the world.

Replacing the Retail Sales Tax with the Harmonized Sales Tax will eliminate the embedded sales tax that many products carry, reducing business costs and making Ontario more competitive, leading to more jobs.