Important @onpoli report from @info_FAO on Ontario tax expenditures. They cost the Province $44.4 billion. This is the second largest spending area, next to health care.
@info_FAO found that over the past eight years tax expenditures grew faster than program spending, averaging 4.4% as compared to 2.6%.
Highest average annual growth was in corporate income tax expenditures, as compared to other taxes.
And, increases in tax expenditures outstripping program spending is forecast to accelerate.
In 2019-20, tax expenditures spending is projected to increase by 4.8%, while program spending is forecast to increase by 1.3%.
Two poorly designed tax expenditures, LIFT and CARE account for much of the growth in that year.
LIFT tax credit was the Ford government’s response to resistance to rolling back the legislated increase in the minimum wage to #15andfairness.
The CARE program is poorly designed childcare tax credit, that doesn’t add one child care space or subsidy to the system
The study also looked at who benefits from the largest personal income tax expenditures
It found 20% of Ontario families with the highest incomes will receive 43% of the total benefit from the 12 largest tax expenditures in 2019-20.
The lowest 60 per cent of Ontario families, earning $78,100 or less, will receive only 38% of the benefit from those tax expenditures.
These expenditures need much closely scrutiny, as much of these funds would be better spent on supporting public services
