Path to the 2020 Prosperity Agenda

Released November 2007

In its Report last year, the Task Force set out an Agenda for achieving Ontario’s economic potential by 2020.  This year, the Task Force identifies the key first steps to put Ontario on the path to achieving this Agenda.

In Path to the 2020 Prosperity Agenda, the Task Force reports that Ontario’s GDP per capita is now $6,000, or 12 percent, behind the median of the 16 jurisdictions, up from the 2005 gap of $5,500 in constant dollars (2006). The Task Force concludes that Ontario’s competitiveness is important for the average Ontario family.  Its research shows that, if we met our prosperity potential, families would gain $8,600 in disposable, after tax income – every year. Governments in Ontario would also generate an additional $27 billion in tax revenue, an amount that could fund important social and capital investments. 

Lagging productivity continues to be the biggest barrier to closing the gap. The Task Force proposes a wide range of initiatives to encourage and support innovation, but is placing special emphasis this year on tax changes as the government prepares its first budget. A priority is to build a smarter tax system to raise motivations for businesses to invest. Tax changes would help lift Ontario’s anemic business investment in productivity- and wage-enhancing machinery, equipment, and software. The Report recommends:

Attitudes: Accept the challenge; overcome complacency

  • Government, business, labour, and community leaders need to turn up the volume on the importance of prosperity and productivity and prosperity

Investment: Focus on people and technology

  • Invest in focused and innovative ways to fight poverty
  • Raise awareness among all Ontarians of the benefits of education
  • Continue investments in post-secondary education
  • Assess the tradeoff between research and the student experience in our universities
  • Step up business investments in information and communication technology

Motivations: Pursue smarter taxation

  • Convert the provincial sales tax to a value added tax harmonized with the GST
  • Remove the capital tax immediately
  • Reduce corporate income tax rates
  • Continue attacking high marginal tax rates for lower income Ontarians

Structures: Place a premium on creativity and innovation

  • Focus venture capital efforts on quality, not quantity
  • Continue to expand innovation policy to include building management capabilities
  • Pursue the reduction of barriers to investment and trade
Topics: Economic policy, growth, and strategy, Government investment and innovation, Business growth and innovation, Clusters, Social policy