Transparency in Taxation, 2011
TRANSPARENCY IN TAXATION
Tax expenditure reporting is an important element of fiscal accountability. It increases fiscal transparency by providing a comprehensive picture of forgone revenue in the tax system.
STRUCTURE OF THE REPORT
This report provides the most current estimates of forgone revenue with respect to provisions in the following taxes:
- Personal Income Tax;
- Corporate Income Tax;
- Sales and Commodity Tax;
- Education Property Tax;
- Employer Health Tax;
- Mining Tax;
- Estate Administration Tax; and
- Gross Revenue Charge.
SCOPE
Given the absence of a universally accepted definition of a “tax expenditure,” this report continues the approach adopted in previous reports of listing estimates of forgone revenue that could potentially be included under a broad-based tax system.
Under a tax collection agreement between Ontario and Canada, the federal government determines the Personal Income Tax and Corporate Income Tax bases. Similarly, under the Comprehensive Integrated Tax Coordination Agreement between Ontario and Canada, the federal government determines the Harmonized Sales Tax base. As a result, Ontario is impacted by federal tax expenditures associated with these tax bases. This report includes these tax expenditures that are shared with the federal government and Ontario-only tax credits and rebates that are administered by the federal government. Also included in the report are Ontario tax reductions and exemptions administered by the Province or Ontario’s municipalities.
Measures that were repealed or phased out in the calendar year are not included in the report.
METHOD
The estimates in this report were developed using the latest available taxation and economic data, forecast to the 2011 calendar year. The data used to estimate the values of the tax provisions come from a variety of sources. The estimated value of a tax provision may differ from the amount reported in a prior year for a variety of reasons including amendments to the provision, changes in economic factors, revisions to the underlying data and improvements to the estimation method. Some tax provision estimates are particularly sensitive to economic conditions or other variables and, therefore, can fluctuate significantly from year to year.
Each estimate is presented on a full-year basis, regardless of when a tax provision became effective within the year. This approach enables a better comparison of the revenue forgone from measures that come into effect at different times in the year. Tax expenditure reports prior to 2010 presented estimates only for the portion of the year that a tax provision was in place. Hence, care must be taken when comparing this report to earlier reports.
It is important to note that the estimates in this report are not intended to represent the potential change in revenue if the tax provisions were not in place. Each estimate has been determined separately and in isolation from other factors, such as the interactions between various tax provisions. As a result, the estimates cannot be added together to determine the total cost of a particular group of tax expenditures.
Tax expenditure estimates above $10 million are rounded to the nearest $5 million. Tax expenditure estimates of less than $1 million are denoted by the letter “s” (small). This report also includes tax provisions for which relevant data are not currently available.
PERSONAL INCOME TAX
Table 1 provides estimates of tax provisions relating to the Ontario Personal Income Tax system. Business provisions listed here are for unincorporated businesses.
The Ontario Energy and Property Tax Credit provides relief to low- to moderate-income Ontarians for property tax and the sales tax on energy. The energy component is reported as a Sales Tax measure in Table 4 and the property tax component is reported as an Education Property Tax measure in Table 7.
The Ontario Sales Tax Credit is reported as a Sales Tax measure in Table 4.
The Northern Ontario Energy Credit and the Ontario Senior Homeowners’ Property Tax Grant are reported in Volume 1 of the Public Accounts of Ontario.
| Tax Provisions | 2011 Estimates2 ($ Millions) |
|---|---|
| Ontario Non-refundable Tax Credits | |
| Adoption Expense Credit | s |
| Age Credit | 255 |
| Amounts Transferred from a Spouse or Common-law Partner | 25 |
| Basic Personal Credit | 3,800 |
| Canada Pension Plan (CPP)/Quebec Pension Plan (QPP) Contributions Credit | 500 |
| Caregiver Credit | 20 |
| Charitable Donations Credit | 600 |
| Disability Credit | 105 |
| Eligible Dependant Credit | 75 |
| Employment Insurance (EI) Premiums Credit | 170 |
| Infirm Dependant Credit | 1 |
| Medical Expense Credit | 150 |
| Ontario Overseas Employment Tax Credit | 8 |
| Pension Income Credit | 115 |
| Spouse or Common-law Partner Credit | 170 |
| Student Loan Interest Credit | 7 |
| Tuition and Education Credits | 310 |
| Ontario Tax Reduction (OTR) | |
| OTR — Basic Reduction | 215 |
| OTR — Reduction for Dependent Children Under 19 | 200 |
| OTR — Reduction for Disabled or Infirm Dependants | 15 |
| OTR — Total | 365 |
| Ontario Labour Sponsored Investment Fund Tax Credits | |
| Labour Sponsored Investment Fund (LSIF) Tax Credit | 3 |
| Research Oriented Investment Fund (ROIF) Tax Credit | s |
| Ontario Refundable Tax Credits | |
| Ontario Focused Flow-through Share Tax Credit | 10 |
| Ontario Political Contribution Tax Credit | 10 |
| Children’s Activity Tax Credit | 75 |
| Exemptions, Deductions, Deferrals and Other Measures Shared with the Federal Government | |
| Business | |
| Items for Which an Estimate is not Available | |
| Assistance for Artists and Deduction for Canadian Art Purchased by Unincorporated Businesses | |
| Assistance for Prospectors and Grubstakers | |
| Deduction of Accelerated Capital Cost Allowance | |
| Deferral Through Use of Billed-basis Accounting by Professionals | |
| Employment | |
| Deduction for Clergy Residence | 15 |
| Deduction of Home Relocation Loans | s |
| Deduction for Military and Police Deployed to High-risk International Missions | 10 |
| Deduction of Other Employment Expenses | 280 |
| Deduction of Union and Professional Dues | 155 |
| Deduction for Employee Security Options | 195 |
| Moving Expense Deduction | 15 |
| Northern Residents Deductions | 2 |
| Items for Which an Estimate is not Available | |
| Deduction for Artists and Musicians | |
| Deduction for Tradespersons’ and Apprentice Vehicle Mechanics’ Tools | |
| Deduction for Tuition Assistance for Adult Basic Education | |
| Deferral of Salary Through Leave of Absence/Sabbatical Plans | |
| Employee Benefit Plans | |
| Non-taxation of Business-paid Health and Dental Benefits | |
| Non-taxation of Certain Non-monetary Employment Benefits | |
| Special Tax Computations for Certain Retroactive Lump-sum Payments | |
| Farming and Fishing | |
| Items for Which an Estimate is not Available | |
| Cash-basis and Flexibility in Inventory Accounting | |
| Deferral of Income for Farmers | |
| Income Stabilization Account for Farmers | |
| Investment | |
| $750,000 Lifetime Capital Gains Exemption for Farm or Fishing Property and Small Business Shares |
150 |
| Deduction of Allowable Business Investment Losses | 10 |
| Deduction of Carrying Charges Incurred to Earn Income | 265 |
| Deduction of Resource-related Expenditures | 110 |
| Partial Inclusion of Capital Gains | 700 |
| Tax-Free Savings Accounts (TFSAs) – Non-taxation of Investment Income | 100 |
| Items for Which an Estimate is not Available | |
| Capital Gains Exemptions — $1,000 on Personal-use Property and $200 on Foreign Exchange Transactions | |
| Deferral of Capital Gains Through Five-year Reserves | |
| Deferral of Capital Gains Through Rollovers | |
| Deferral of Capital Gains Through 10-year Reserves for Farm or Fishing Property and Small Business Shares | |
| Deferral of Capital Gains Through Transfers to a Spouse, Spousal Trust or Family Trust | |
| Exemption for Capital Gains Arising from Certain Donations | |
| Non-taxation of Capital Gains on Principal Residences | |
| Taxation of Capital Gains Upon Realization | |
| Non-taxable Income | |
| Guaranteed Income Supplement and Allowance Benefits | 35 |
| Social Assistance Benefits and Provincial Supplements | 35 |
| Workers’ Compensation Benefits | 175 |
| Items for Which an Estimate is not Available | |
| Certain Service Pensions, Allowances, Compensation and Amounts, and Certain War Pensions | |
| Damages With Respect to Personal Injury or Death | |
| Death Benefits of Up to $10,000 | |
| Employer-paid CPP/QPP Contributions and EI Premiums | |
| Gifts and Bequests | |
| Income from the Office of the Governor General and Allowances for Diplomats and Other Government Employees Posted Abroad | |
| Income of Status Indians and Indian Bands on Reserve | |
| Investment Income on Life Insurance Policies | |
| Lottery and Gambling Winnings | |
| Partial Inclusion of U.S. Social Security Benefits | |
| Strike Pay | |
| Special Circumstances | |
| Child Care Expense Deduction | 175 |
| Pension Income Splitting | 250 |
| Treatment of Spousal and Child Support Payments | 40 |
| Items for Which an Estimate is not Available | |
| Deduction Related to Vows of Perpetual Poverty | |
| Disability Supports Deduction | |
| Exemption of Scholarship, Fellowship and Bursary Income | |
| Tax-free Amount for Emergency Service Volunteers | |
| Tax-deferred Savings | |
| Registered Pension Plans (RPPs) — Deduction for Contributions | 815 |
| Registered Retirement Savings Plans (RRSPs) — Deduction for Contributions | 2,010 |
| Items for Which an Estimate is not Available | |
| Deferred Profit-sharing Plans | |
| Registered Disability Savings Plans (RDSPs) — Non-taxation of Investment Income and Federal Contributions | |
| Registered Education Savings Plans (RESPs) — Non-taxation of Investment Income and Federal Contributions | |
| RPPs — Non-taxation of Investment Income | |
| RRSPs and Registered Retirement Income Funds — Non-taxation of Investment Income | |
- 1 Estimates do not include the impact of revenue forgone from Personal Income Tax provisions for trusts, which are taxed as individuals under the Taxation Act, 2007.
- 2 Estimates are based on 2008 tax filer data forecast to represent the 2011 taxation year.
PERSONAL INCOME TAX — DESCRIPTION OF TAX PROVISIONS
The following Personal Income Tax provisions have been introduced or changed since the Transparency in Taxation, 2010 report.
FEDERAL CHANGES
Under a tax collection agreement between Ontario and Canada, the federal government determines the Personal Income Tax base. In addition, many of Ontario’s tax credits follow the structure of federal credits. Changes that were recently introduced by the federal government to the following tax measures will modify the Personal Income Tax base or shared tax credits and have been reflected in Ontario’s tax expenditure estimates:
- tuition and education tax credits;
- registered disability savings plans;
- individual pension plans;
- registered retirement savings plans;
- registered education savings plans;
- capital gains and tax on split income with a minor;
- capital gains and donations of shares; and
- tax-free amount for volunteer firefighters.
ONTARIO NON-REFUNDABLE TAX CREDITS
The non-refundable tax credits listed in the following table are based on amounts that are adjusted for inflation each year.
| Non-refundable Tax Credits | |
|---|---|
| Adoption Expense Credit, maximum claim | $11,107 |
| Age Credit, maximum claim | $4,445 |
| Reduced by 15 per cent of individual’s net income in excess of $33,091 | |
| Fully phased out when individual’s net income reaches $62,725 | |
| Basic Personal Credit | $9,104 |
| Caregiver Credit, maximum claim | $4,291 |
| Reduced by dependant’s net income in excess of $14,681 | |
| Fully phased out when dependant’s net income reaches $18,972 | |
| Disability Credit | $7,355 |
| Disability supplement for individuals under 18 years of age, maximum claim | $4,290 |
| Eligible Dependant Credit, maximum claim | $7,730 |
| Reduced by dependant’s net income in excess of $773 | |
| Fully phased out when dependant’s net income reaches $8,503 | |
| Infirm Dependant Credit, maximum claim | $4,292 |
| Reduced by dependant’s net income in excess of $6,099 | |
| Fully phased out when dependant’s net income reaches $10,391 | |
| Medical Expense Credit | |
| Qualifying medical expenses of self, spouse or common-law partner, and dependent children in excess of the lesser of three per cent of net income and $2,061 | no limit |
| Qualifying medical expenses of other dependants in excess of the lesser of three per cent of the dependant’s net income and $2,061, maximum claim for each | $11,107 |
| Pension Income Credit, maximum claim | $1,259 |
| Spouse or Common-law Partner Credit, maximum claim | $7,730 |
| Reduced by spouse’s or common-law partner’s net income in excess of $773 | |
| Fully phased out when spouse or common-law partner’s net income reaches $8,503 | |
| Tuition and Education Credits | |
| Education Credit, full time or eligible for Disability Credit (per month) | $490 |
| Education Credit, part time (per month) | $147 |
| Maximum transfer | $6,295 |
CORPORATE INCOME TAX
Estimates of tax provisions relating to the Ontario Corporate Income Tax system are presented in Table 3.
| Tax Provisions | 2011 Estimates1 ($ Millions) |
|---|---|
| Ontario Refundable Tax Credits | |
| Ontario Apprenticeship Training Tax Credit2 | 160 |
| Ontario Book Publishing Tax Credit | 3 |
| Ontario Business Research Institute Tax Credit | 9 |
| Ontario Computer Animation and Special Effects Tax Credit3 | 25 |
| Ontario Co-operative Education Tax Credit2 | 30 |
| Ontario Film and Television Tax Credit3 | 95 |
| Ontario Innovation Tax Credit | 230 |
| Ontario Interactive Digital Media Tax Credit3 | 20 |
| Ontario Production Services Tax Credit3 | 150 |
| Ontario Sound Recording Tax Credit | 1 |
| Item for Which an Estimate is not Available | |
| Ontario Small Beer Manufacturers’ Tax Credit | |
| Ontario Deductions, Non-Refundable Tax Credits and Exemptions | |
| Ontario Credit Union Tax Reduction4 | 4 |
| Ontario Political Contributions Tax Credit4 | s |
| Ontario Research and Development (R&D) Tax Credit5 | 135 |
| Ontario Resource Tax Credit | 3 |
| Ontario Small Business Deduction4 | 1,335 |
| Ontario Tax Credit for Manufacturing and Processing (M&P)4 | 110 |
| Ontario Tax Exemption for Commercialization | s |
| Exemptions, Deductions, Deferrals and Other Measures Shared with the Federal Government | |
| Allowable Business Investment Losses | 3 |
| Deductibility of Charitable Donations | 85 |
| Deductibility of Gifts of Cultural Property and Ecologically Sensitive Land | 4 |
| Deductibility of Gifts to the Crown | s |
| Deferral of Income for Farmers | s |
| Holdback on Progress Payments to Contractors | 15 |
| Non-taxation of Non-profit Organizations | 180 |
| Partial Inclusion of Capital Gains | 600 |
| Items for Which an Estimate is not Available | |
| Accelerated Write-off of Capital Assets and Resource-related Expenditures | |
| Cash-basis and Flexibility in Inventory Accounting | |
| Deductibility of Countervailing and Anti-dumping Duties | |
| Deferral Through Capital Gains Rollovers | |
| Deferral Through Use of Billed-basis Accounting by Professionals | |
| Donations of Medicine for the Developing World | |
| Exemption for Capital Gains Arising from Certain Donations | |
| Expensing of Advertising Costs | |
| Non-taxation of Provincial, Municipal and Federal Crown Corporations | |
| Non-taxation of Registered Charities | |
| Taxation of Capital Gains upon Realization | |
| Tax Exemption on Income of Foreign Affiliates of Canadian Corporations | |
- 1 Estimates are forecast to the 2011 calendar year based on preliminary 2009 and 2010 tax administration data, unless otherwise noted, and assume a full-year implementation of Corporate Income Tax (CIT) changes in 2011. Estimates do not include the revenue forgone from CIT provisions for mutual fund corporations.
- 2 Estimate includes the impact of both the Corporate and Personal Income Tax provisions.
- 3 Estimate is based on tax administration data and other administrative data.
- 4 Estimate is based on an 11.5 per cent general CIT rate in effect for the entire calendar year.
- 5 Estimate is net of any recapture of the Ontario R&D Tax Credit.
CORPORATE INCOME TAX — DESCRIPTION OF CHANGES TO TAX PROVISIONS
The following Corporate Income Tax (CIT) provisions have been introduced or changed since the Transparency in Taxation, 2010 report.
ONTARIO REFUNDABLE TAX CREDITS
Ontario Book Publishing Tax Credit — The Ontario Book Publishing Tax Credit is a 30 per cent refundable tax credit available to Ontario book publishing corporations for qualifying expenditures related to publishing and promoting a book by a Canadian author in an eligible category of writing. Eligible categories of writing are adult or children’s fiction, non-fiction, poetry or biography.
As announced in the 2011 Budget, for expenditures incurred after March 29, 2011, the 12-month period for qualifying marketing expenditures was changed to a period beginning one year before and ending one year after the date of publication.
ONTARIO DEDUCTIONS, NON-REFUNDABLE TAX CREDITS AND EXEMPTIONS
Ontario Credit Union Tax Reduction — Credit unions are eligible for a reduced CIT rate of 4.5 per cent on taxable income in excess of the income eligible for the small business deduction in order to maintain the small business rate on all credit union taxable income.
On July 1, 2011, the general CIT rate was reduced from 12 per cent to 11.5 per cent. The general CIT rate will be further reduced to 11 per cent on July 1, 2012 and to 10 per cent on July 1, 2013.
Ontario Political Contributions Tax Credit — A non-refundable tax credit, based on the general CIT rate, is available for eligible Ontario political contributions of up to $18,600.
On July 1, 2011, the general CIT rate was reduced from 12 per cent to 11.5 per cent. The general CIT rate will be further reduced to 11 per cent on July 1, 2012 and to 10 per cent on July 1, 2013.
Ontario Small Business Deduction — Canadian-controlled private corporations are eligible for a reduced CIT rate of 4.5 per cent on the first $500,000 of active business income.
On July 1, 2011, the general CIT rate was reduced from 12 per cent to 11.5 per cent. The general CIT rate will be further reduced to 11 per cent on July 1, 2012 and to 10 per cent on July 1, 2013.
Ontario Tax Credit for Manufacturing and Processing (M&P) — The general CIT rate is reduced to 10 per cent for income from M&P (including income from the generation of electricity and from the production of steam), farming, fishing, mining and logging.
On July 1, 2011, the general CIT rate was reduced from 12 per cent to 11.5 per cent. The general CIT rate will be further reduced to 11 per cent on July 1, 2012 and to 10 per cent on July 1, 2013.
EXEMPIONS, DEDUCTIONS, DEFERRALS AND OTHER MEASURES SHARED WITH THE FEDERAL GOVERNMENT
Items for Which an Estimate is not Available
Temporary Incentive for Manufacturing and Processing (M&P) Machinery and Equipment — An accelerated Capital Cost Allowance (CCA) rate of 50 per cent on a straight-line basis is available to corporations for M&P machinery and equipment acquired after March 18, 2007, and before 2012. As announced in the 2011 federal budget, this accelerated CCA rate is extended, for two years, to eligible assets acquired before 2014. Ontario parallels this federal measure.
SALES AND COMMODITY TAX
SALES TAX
Estimates of tax provisions relating to sales taxes, including the Harmonized Sales Tax (HST) and Retail Sales Tax (RST), are presented in Tables 4 and 5.
| Tax Provisions | 2011 Estimates1 ($ Millions) |
|---|---|
| Ontario-specific Items | |
| Ontario Point-of-Sale Exemptions | |
| Books | 170 |
| Children’s Car Seats/Booster Seats | 6 |
| Children’s Clothing | 115 |
| Children’s Footwear | 20 |
| Feminine Hygiene Products and Diapers | 30 |
| Prepared Foods and Beverages ($4 and under) | 255 |
| Print Newspapers | 65 |
| Qualifying Purchases by First Nations | 25 |
| Ontario Public Service Body Rebates | |
| Hospitals | 430 |
| Municipalities | 1,030 |
| Public Colleges | 55 |
| Qualifying Non-profit Organizations | 70 |
| Registered Charities | 340 |
| School Authorities | 365 |
| Universities | 180 |
| Other Ontario Measures | |
| Ontario Energy and Property Tax Credit (OEPTC) — Energy Component2,3 | 460 |
| Ontario New Housing Rebate (including new residential rental property) | 1,005 |
| Ontario Sales Tax Credit (OSTC)4 | 1,090 |
| Exemptions, Zero-rating and Other Measures Shared with the Federal Government5 | |
| Business | |
| Exemption for Ferry, Road and Bridge Tolls | 25 |
| Exemption and Rebate for Legal Aid Services | 10 |
| Rebate for Foreign Conventions and Tour Packages | 7 |
| Rebate for Remembrance Day Poppies and Wreaths | s |
| Small Suppliers’ Threshold | 140 |
| Zero-rating of Agricultural and Fish Products and Purchases | s |
| Items for Which an Estimate is not Available | |
| Exemption for Domestic Financial Services | |
| Non-taxability of Certain Importations | |
| Charities and Non-Profit Organizations | |
| Exemption for Certain Supplies Made by Charities and Non-profit Organizations | 645 |
| Education | |
| Exemption for Education Services (Tuition) | 395 |
| Health Care | |
| Exemption for Health Care Services | 530 |
| Zero-rating of Medical Devices | 115 |
| Zero-rating of Prescription Drugs | 500 |
| Households | |
| Exemption for Child Care and Personal Services | 105 |
| Zero-rating of Basic Groceries | 2,195 |
| Housing | |
| Exemption for Residential Rent (Long-Term) | 745 |
| Items for Which an Estimate is not Available | |
| Exemption for Sales of Used Residential Housing and Other Personal-use Real Property | |
| Municipalities | |
| Exemption for Municipal Transit | 130 |
| Exemption for Water and Basic Garbage Collection Services | 190 |
- 1 Estimates are based on preliminary administrative data or data from Statistics Canada, unless otherwise noted.
- 2 Estimate is based on 2008 tax filer data forecast to represent the 2011 benefit year.
- 3 The energy portion of the Ontario Energy and Property Tax Credit is netted against sales tax revenue.
- 4 Estimate is based on 2008 tax filer data forecast to represent payments to be made in 2011.
- 5 Estimates represent the forgone revenue associated with the provincial component of the HST.
| Tax Provisions | 2011 Estimates ($ Millions) |
|---|---|
| Exemption for Automobile Insurance Premiums1 | 955 |
| Exemption for Individual Life and Health Insurance Premiums2 | 545 |
| Vendor Compensation3 | 3 |
- 1 Based on industry data.
- 2 Based on insurance premiums data published by the Canadian Life and Health Insurance Association Inc.
- 3 Based on returns filed by registered tax collectors.
SALES TAX — DESCRIPTION OF CHANGES TO TAX PROVISIONS
The following sales tax provisions have been introduced or changed since the Transparency in Taxation, 2010 report.
Ontario Energy and Property Tax Credit (OEPTC) — The 2011 OEPTC will be paid in four instalments, in July and December 2011, and March and June 2012.
Beginning in July 2012, payment of the refundable OEPTC, Ontario Sales Tax Credit (OSTC) and Northern Ontario Energy Credit will be combined and paid as the Ontario Trillium Benefit, which will be delivered monthly to qualifying individuals and families. Both the OSTC and the energy component of the OEPTC are reported as Sales Tax measures in Table 4. The property tax component of the OEPTC is reported as an Education Property Tax measure in Table 7.
Rebate for Remembrance Day Poppies and Wreaths — The rebate allows the Dominion Command or any provincial command or branch of the Royal Canadian Legion to recover the GST/HST paid on their purchases of poppies and wreaths.
COMMODITY TAX
Estimates of tax provisions relating to commodity taxes, including the Fuel Tax, Gasoline Tax, Land Transfer Tax, Tobacco Tax and Beer and Wine Tax, are presented in Table 6.
| Tax Provisions | 2011 Estimates ($ Millions) |
|---|---|
| Fuel Tax | |
| Exemptions/Reduced Rates | |
| Exemption for Biodiesel1 | 7 |
| Exemption for Coloured Fuel2 | 285 |
| Reduced Rate for Railway Diesel3 | 55 |
| Refunds | |
| Auxiliary Power Take-off Equipment4 | 2 |
| Gasoline Tax | |
| Exemptions/Reduced Rates | |
| Exemption for Methanol and Natural Gas5 | 15 |
| Reduced Rate for Aviation Fuel6 | 275 |
| Reduced Rate for Propane6 | 10 |
| Refunds | |
| Auxiliary Power Take-off Equipment4 | s |
| Aviation Fuel4 | s |
| Tax-exempt Use in Unlicensed Equipment4 | 7 |
| Land Transfer Tax | |
| Exemptions | |
| Deferrals and Exemptions for Corporate Reorganizations4 | 25 |
| Family Business Conveyances4 | s |
| Family Farms2 | 7 |
| Life Leases2 | s |
| Items for Which an Estimate is not Available | |
| Hospital Restructuring | |
| Oil/Pipeline Easements and Mineral Lands | |
| Other Transfers and Dispositions | |
| Reorganization of Charities | |
| Refunds | |
| First-time Home Buyers Rebate4 | 145 |
| Tobacco Tax | |
| Compensation for Tax Collectors7 | s |
| Beer and Wine Tax8 | |
| Exemptions/Reduced Rates | |
| Exemption for Promotional Distribution9 | 1 |
| Reduced Rate for Beer Made by Ontario Microbrewers10 | 6 |
| Reduced Rate for Beer Made and Sold at Ontario Brew Pubs11 | s |
| Reduced Rate for Ontario Wine and Ontario Wine Coolers12 | 15 |
| Reduced Rate for Wine Coolers13 | s |
- 1 Based on estimated amount of biodiesel sold in Ontario.
- 2 Based on tax administration data.
- 3 Forgone revenue estimated as difference from the general fuel tax rate.
- 4 Based on refunds filed or rebates/deferrals claimed.
- 5 Forecast for the 2011 calendar year is based on 2007 provincial Input–Output tables from Statistics Canada.
- 6 Forgone revenue estimated as difference from the general gasoline tax rate.
- 7 Based on returns filed by registered tax collectors.
- 8 Beer and wine taxes apply on sales of domestic beer in The Beer Store, on-site manufacturers’ stores and licensed establishments, and on wine sales in winery retail stores. Does not include sales in LCBO stores or licensed establishments where the purchase is from the LCBO.
- 9 Based on estimated manufacturers’ promotional distribution.
- 10 Forgone revenue estimated as difference from the basic tax on beer made by a beer manufacturer.
- 11 Forgone revenue estimated as difference from the basic tax and volume tax on beer made by a beer manufacturer.
- 12 Forgone revenue estimated as difference from the basic tax on wine or wine coolers that is not Ontario wine or Ontario wine coolers.
- 13 Forgone revenue estimated as difference from the volume tax on wine.
EDUCATION PROPERTY TAX
Table 7 provides estimates of tax provisions relating to the Education Property Tax system.
| Tax Provisions | 2011 Estimates2 ($ Millions) |
|---|---|
| Brownfields Financial Tax Incentive Program3 | s |
| Charity Rebate | 9 |
| Conservation Land Property Tax Exemption Program | 4 |
| Eligible Convention Centres Exemption | s |
| Eligible Live Performance Theatres Exemption and Professional Sports Facility Tax Rate Reduction | 10 |
| Farm Property Class Tax Rate Reduction | 65 |
| Farmlands Awaiting Development Sub-class Tax Rate Reduction | s |
| Heritage Property Tax Rebate | s |
| Managed Forest Tax Incentive Program | 4 |
| Ontario Energy and Property Tax Credit (OEPTC) — Property Tax Component4,5 | 850 |
| Seniors and Persons with Disabilities Property Tax Relief6 | s |
| Tax Exemptions Under Private Statutes | 5 |
| Vacant Commercial and Industrial Unit Rebate | 30 |
| Vacant Land and Excess Land Sub-class Tax Rate Reduction | 50 |
| Items for Which an Estimate is not Available | |
| Other Tax Exemptions Under Public Statutes | |
| Discretionary exemptions granted by municipalities to special purpose properties (e.g., legions, navy leagues, public–private capital facilities) | |
| Mandatory exemptions granted to special purpose/institutional properties (e.g., places of worship, cemeteries, Boy Scouts Association of Canada and Canadian Girl Guides Association, charitable institutions including Canadian Red Cross, St. John Ambulance and charitable, non-profit philanthropic corporations organized for the relief of the poor) | |
| Relief from Property Taxes That Are Unduly Burdensome for Residential, Farm or Managed Forest Properties |
- 1 Expenditures related to provincial land taxes or payments made in lieu of taxes have not been included.
- 2 Estimates based on 2011 education tax rates, 2011 Assessment Roll, 2009 Municipal Financial Information Returns and municipal tax policies, unless otherwise noted.
- 3 Effective October 1, 2004, municipalities may pass bylaws cancelling municipal property taxes on eligible brownfields properties. The Province may match the municipal reduction with an education property tax reduction.
- 4 Estimate is based on 2008 tax filer data forecast to represent the 2011 benefit year.
- 5 The property tax portion of the Ontario Energy and Property Tax Credit is netted against Education Property Tax revenue. See “Sales Tax – Description of Changes to Tax Provisions” for more information.
- 6 Estimate does not include expenditures due to the exemption from taxation on 10 per cent of the assessment of improvements to accommodate seniors and persons with disabilities in newly built homes or the expenditure on such improvements in existing homes.
EMPLOYER HEALTH TAX
Table 8 provides an estimate of the tax exemption under the Employer Health Tax.
| Tax Provision | 2011 Estimate ($ Millions) |
|---|---|
| $400,000 Exemption for Private-sector Employers1 | 720 |
- 1 Estimate is based on 2009 remuneration data forecast to represent the 2011 taxation year.
MINING TAX
Estimates of tax provisions relating to the Ontario Mining Tax system are presented in Table 9.
| Tax Provisions | 2011 Estimates ($ Millions) |
|---|---|
| Mining Tax Exemption | s |
| Mining Tax Holiday for New Mines (other than remote mines) | s |
| Mining Tax Holiday for New Remote Mines | s |
| Mining Tax Rate for Remote Mines | s |
| Processing Allowance | 40 |
| Item for Which an Estimate is not Available | |
| Fast Write-off of Exploration Costs |
- 1 Estimates are forecast to the 2011 calendar year based on 2010 Ontario Mining Tax administration data.
ESTATE ADMINISTRATION TAX
Table 10 provides an estimate of an exemption under the Estate Administration Tax.
| Tax Provision | 2011 Estimate ($ Millions) |
|---|---|
| Exemption Where the Value of the Estate Does Not Exceed $1,000 | s |
GROSS REVENUE CHARGE
Table 11 provides an estimate of the tax holiday under the Gross Revenue Charge.
| Tax Provision | 2011 Estimate ($ Millions) |
|---|---|
| Gross Revenue Charge 10-year Holiday | s |
- 1 Consistent with this report’s intent to provide an estimate of forgone tax revenue, the expenditure only includes the property tax portion of the GRC.