Successive provincial governments have promised not to raise taxes long-term but failed to deliver, new study claims
Those paying the top rate of personal income tax in Canada’s most populated province have been let down by provincial lawmakers according to a new report.
Fraser Institute senior fellow, Ben Eisen, says that promises made a decade ago that tax increases would be temporary have been broken, as successive Ontario provincial governments kept the higher rates of personal income tax in place.
In a report titled ‘Broken Promises: The persistence of elevated personal and corporate income taxes in Ontario’, Eisen and his co-authors highlight that Ontario now has the third highest top combined federal/provincial-state personal income tax rate in Canada or the United States.
Those paying the top rate do so at a combined 53.3%, up from 46.4% in 2012.
“Contrary to their repeated promises not to increase taxes, Dalton McGuinty’s government enacted tax increases that raised the province’s top personal income tax rate, also promising the increase was temporary and would later be reversed—neither he nor his successor Premier Wynne made good on this commitment, just as the current Ontario government has failed to take any action,” Eisen said.
The report says that higher top tax rates for individuals and businesses negatively impact economic output over time and have harmed growth in Ontario over the past decade.
