News

Sousa takes feds to task over tax hike criticism

By Antonella Artuso, Queen's Park Bureau Chief

Ontario Finance Minister Charles Sousa. (Craig Robertson/Toronto Sun files)

Ontario Finance Minister Charles Sousa. (Craig Robertson/Toronto Sun files)

Ontario Finance Minister Charles Sousa said he was “shocked” to receive a letter from his federal counterpart Jim Flaherty criticizing a Harmonized Sales Tax hike.

Metrolinx recommended a 1% HST increase to fund transit in the Greater Toronto and Hamilton area (GTHA), which prompted federal Finance Minister Flaherty to fire off a letter last week to Ontario Liberals, accusing them of trying to move into tax space created when his government cut the GST.

The provincial government has not made any decisions about the Metrolinx tax proposal.

“I’m thinking, ‘Fine, then let’s sit down, and you come to the table,’” Sousa said Monday. “There’s only a meagre 4% that (the federal government is) providing for our public transit initiatives.

“We need to have the federal government at the table and we need to have cooperation from all sides to make this happen,” he said.

When asked about Flaherty’s assertion that Ontario cannot hike the HST in one region — the GTHA — Sousa said any province can increase sales taxes.

Ontario Premier Kathleen Wynne is proposing to create a new dedicated revenue stream to raise about $2 billion a year in the GTHA to pay for a $50-billion transit improvement plan crafted by Metrolinx.

While all levels of government agree on the need for new transportation infrastructure, a gulf has opened between the feds, the province and the City of Toronto on how to pay for it.

The city, led by Mayor Rob Ford, has rejected almost all the proposed revenue tools.

Flaherty has called on the provincial government to look at more efficiencies rather than increasing taxes on Ontarians.

Tory MPP Peter Shurman said his party believes that the necessary money can be found within the existing budget without seeking out new sources of revenue.

While Ontario NDP Leader Andrea Horwath objects to a HST increase, she does call on the federal government to increase funding for transit.

The Stephen Harper government provides a portion of the federal gas tax to municipalities for infrastructure — $373 million a year in the GTHA.

The new Building Canada plan, which includes the indexed Gas Tax Fund, provides over $47 billion across the country for projects that would include transit, the federal government says.

Sousa said the federal financial commitment comes nowhere close to meeting the transit needs of the region.

 


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