The Ontario Liberal government, in cahoots with the Tories in Ottawa, are bailing out corporate Ontario with another $9 billion gift of public tax dollars.

They’re doing it by relieving Big Business of $4.5 billion in sales taxes, and by cutting the corporate income tax (CIT) and capital taxes by another $4.5 billion.

And the public’s going to shell out for it by: (1) paying a new 13% Harmonized Sales Tax that will likely increase after 2015; and (2) paying for program and service cuts and user fees after the Liberals finish their “rigorous strategic spending review.”

This is public money that ought to go into job creation, health, education, housing, child care, social programs, a higher minimum wage and increased pensions.

They hope you won’t notice their tax “reform” is a massive tax grab – from your pocket into the pockets of the corporations and the wealthy. They hope you won’t object when hospitals, schools and public services are cut back, sold off, or privatized because corporate tax cuts have stripped the cupboards bare.

The HST is a cash cow and a pork barrel for Liberal and Tory governments that can increase the tax rate whenever they want after 2015. That’s what countries with “value-added” (VAT) taxes do – in Europe and elsewhere. In England, VAT taxes rose to 17.5% January 1, 2010. In France, the VAT tax on food is now 19.6%.

The Harper government is cutting a $5 billion cheque to help McGuinty sell the HST to the public. Like Flaherty did to sell corporate tax cuts when he was Treasurer in Ontario, every family will get three cheques totalling up to $900, and every individual will get up to $300, all before the fall 2011 provincial election. That’s the price these governments and their big corporate friends are willing to pay, to get the HST through. That’s how important it is to corporate Canada.

And that’s why Conservative leader Tim Hudak won’t promise to rescind it if the Tories win the 2011 provincial elections.

We need progressive tax reform based on ability to pay – that is, tax reform that will shift the load off working people and put it on those most able to pay – the corporations and the wealthy. Until the 1960s, corporations used to pay up to 50 cents of every tax dollar. Now they pay pennies. And working people pay more and more, and get less and less. The Tories in Ottawa are dropping corporate taxes to 15% by 2012 while the Liberals in Queen’s Park are dropping corporate taxes to 10% by 2014 for a combined Marginal Effective Tax Rate (METR) of 25% – the lowest rate in the industrialized world, and 15% lower than in the US Great Lake states.

In August, the BC courts found the Campbell government could not block a public campaign to force a referendum on the hated HST. If working people can overturn the HST in BC, it can be done in Ontario too.  Mass protests and pressure on MPPs and the Legislature now can make rescinding the HST a central issue in the 2011 provincial election campaign.

Petitions and protests can force the issue here too!

Progressive tax reform would:

  • Axe the HST, and eliminate the PST and GST
  • Double the corporate tax rate for a combined METR rate of 50%
  • Restore and expand the capital tax and the corporate minimum tax
  • Introduce wealth and inheritance taxes on estates over $500,000
  • Eliminate taxes on incomes under $35,000
  • Remove education from the property tax, cutting it by 50%

Progressive tax reform would generate funds that could be used to:

  • Put Ontario back to work
  • Build affordable housing
  • Raise the minimum wage to $16
  • Raise pensions and lower the voluntary age to 60
  • Eliminate tuition and fund public and post-secondary education
  • Expand Medicare to include pharmacare, denticare, long-term care
  • Phase out nuclear and coal fired power and replace them with publicly-owned and environmentally sustainable solar and wind energy.