Navigating through the recovery
In Navigating through the recovery, the Task Force reaffirmed that Ontario’s economy is one of the world’s most successful when compared to similar regions outside North America. But among a similar set of 16 North American jurisdictions, Ontario trailed the median by $7,000 or 13 percent in 2008, up from the 2007 gap of $6,600 in constant dollars (2008). This gap represents lost prosperity, which negatively affects Ontarians at all income levels.
However, the Report also identifies some positive developments in Ontario’s competitiveness. “Ontario has made huge progress on our Prosperity Agenda by restructuring the way we tax business investment,” said Roger Martin, Chairman of the Task Force. Despite the positive development, some troublesome factors remain. The huge federal and provincial deficits will necessitate fiscal belt tightening. The Task Force is concerned that we will cut back more severely on our investment in education – which happened the last time Ottawa and Queen’s Park attacked their deficits. We need to avoid repeating that mistake.
In addition, protectionist sentiments are growing in the US and elsewhere, and we should be working to combat them. The Report applauds the leadership Ontario has shown in encouraging the federal government to launch trade negotiations with the European Union. It urges pursuit of other trade expansion opportunities with countries like China and India.
The 2020 Prosperity Agenda
- Attitudes: we need to remain determined to close the prosperity gap
- Investment: continue investing in people for Ontario’s competitiveness and increase business investment in innovation and information and communication technology
- Motivations: implement announced changes in Ontario’s sales and corporate tax structures and ensure special tax treatment for Labour Sponsored Investment Funds is ended
- Structures: continue to encourage federal efforts to expand international free trade agreements and greater inter provincial trade