Ontario small businesses get a tax cut But only months before election

Ontario will cut its corporate tax rate on the first $500,000 of profits to 3.5 per cent effective Jan. 1, down from the current level of 4.5 per cent, Finance Minister Charles Sousa announced . This has come as companies have expressed concerns over a looming hike to Ontario’s minimum wage. The move by the government is being seen more as political as election are barely six months away.

Small businesses with fewer than 100 employees will get an incentive of $1,000 to hire a young person aged 15 to 29 and another $1,000 if the company retains that worker for six months.

At the same time, Sousa signalled the government has no intention of slowing down the timetable for boosting the minimum wage from the current $11.60 per hour to $14 effective Jan. 1, then to $15 per hour in January 2019. “We will not back down from these commitments,” Sousa said in his speech to the legislature. “An increase to minimum wage cannot wait. People cannot wait. Delaying an increase is denying an increase.”   The hiring incentives and tax cuts for small business will cost the treasury about $500 million over the next three years.