The Government of Ontario is proposing to give municipalities the flexibility to target property tax relief to small businesses. It includes as much as $385 million in local and provincial property tax relief for small businesses. This program is part of the Ontario Action Plan for the 2020 Budget: Protect, Support, Recover.
The Ontario Government headed by Premier Doug Ford has provided the details. According to the Premier Mr Ford, small businesses are the backbones of the Province’s economy and they have been struggling to stand on their feet during this pandemic.
The government is also helping owners of the small scale businesses by removing unfair taxes in jobs as well as lowering the Business Education Tax.
The government also announced through the 2020 budget that, beginning on January 1, 2021, it will level the playing field by reducing high Business Education Tax (BET) rates for over 200,000 employers, or 94% of all business assets in Ontario.
This will generate $450 million in immediate annual savings. It also represents a 30% cut for several companies currently subject to the province’s highest BET fee.
Ontario’s Action Plan: Brief details
Protect, Support, Recover offers $15 billion in new support, building on a total of $30 billion in support from the first phases of Ontario’s response to COVID 19 to date, for a total of $45 billion over a three-year period.
It builds on the urgent response of the government to COVID 19 and offers the assistance of $15.2 billion. It includes additional funding of $7.5 billion.
It builds on aid already made available to families, employees and employers. It offers $13.5 billion in help for individuals and jobs, including $2.4 billion in new funding.
Although Ontario remains focused on getting through COVID 19, it is important for the government and individuals to start building the framework for a strong recovery driven by economic growth. As a part, it provides fresh funding of $4.8 billion for recovery efforts that will be built on overtime.
Cash flow supports
In order to provide relief during this difficult economic period, Ontario made $11.3 billion available to boost cash flow for individuals and companies through tax and other deferrals in 2020. That included the following:
- Providing a six-month interest and penalty-free period for most provincially administered taxes to make payments and providing a $7.5 billion in relief to support 100,000 Ontario Businesses;
- Deferring the June 30 payments of education property tax to school boards by 90 days. It gives municipalities the flexibility to provide residents and businesses with property tax deferrals of over $1.8 billion; and
- The workplace safety and Insurance Board (WSIB) allows premiums to be deferred for six months. It provides workers with up to $1.9 billion in financial relief.
The Government of Ontario also committed to providing $300 million to qualifying small businesses. This is to cover expenses associated with property taxes and energy bills in modified Stage 2 public health restrictions.