Ontario Fall Economic Statement Highlights $24.7 Billion Deficit
The McGuinty government outlined today in the 2009 Fall Economic Statement how it is helping Ontario individuals, families and businesses through the global recession and positioning the province for future job creation and economic growth.
Like many governments around the world, Ontario continues to face significant economic challenges. The government has updated the province’s economic outlook and is forecasting a decline of 3.5 per cent in gross domestic product for 2009. Although there are signs of stabilization in the economy, growth in government revenues and employment will lag behind growth in the economy.
During 2008-09, Ontario’s corporate tax revenues dropped by 48.1 per cent. As a result of falling revenues and investments to help Ontarians through the global recession, the government is projecting a deficit of $24.7 billion for 2009-10. These investments include infrastructure, the auto sector and skills training.
In order to return the province to a sustainable and firmer fiscal footing, while protecting key services, the Ontario Treasury Board will conduct a rigorous strategic spending review. The review will be focused on ensuring the continued relevance and effectiveness of government programs and services and the way they are funded. The goal of the Board is to ensure the key priorities of Ontarians — job creation, health care and education — remain sustainable.
The McGuinty government is positioning the economy for future growth through its proposed tax cuts for Ontario families and businesses, as well as the Harmonized Sales Tax, as outlined in the 2009 Budget. Creating a more competitive tax system is the single most important thing the province can do to strengthen Ontario’s economy for the long term and create jobs.
QUICK FACTS
- Total revenue in 2009-10 is projected to decrease by $5.8 billion from the 2009 Budget forecast, reflecting the effect of the global recession and its impact on Ontario.
- Total expense in 2009-10 is projected to increase by $4.8 billion from the 2009 Budget forecast, largely due to investments that have helped cushion the effect of the recession on families and communities across Ontario.
- The majority of changes in provincial program spending since the 2009 Budget are due to stimulating the economy through investments in skills training and the automotive sector, as well as from higher health care costs, including the province’s response to the H1N1 flu virus, and additional spending on social assistance.
- The 2009 Budget allocated $32.5 billion for infrastructure investments over two years to stimulate economic growth, create short- and long-term jobs and help Ontario families both now and in the future.
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Topics: Canada, declining tax revenue, deficit, Economic Outlook, employment, falling revenue, global economic recession, global financial crisis, Governance, jobs, recession
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