Dwight Duncan: the HST is saving Ontario’s economy—no, really!
The Harmonized Sales Tax may be one of the Liberal government’s biggest weaknesses in the coming election, so they’ve opted to turn taxed lemons into taxed lemonade by convincing Ontarians that the tax is really in their best interest. (It helps, too, that Tim Hudak and the Tories are basically incoherent on this file.) So we aren’t surprised that Ontario Finance Minister Dwight Duncan is claiming that the HST is helping Ontario’s economy move out of the recession.
According to newly released data, Ontario’s economy in the third quarter of 2010 grew at an annualized rate of 1 per cent and has grown 3.6 per cent since the recession ended in mid-2009.
But a positive sign, especially for the Liberals’ fortunes in the Oct. 6 provincial election, was that business spending on machinery and equipment has increased by more than 10 per cent due to the tax reforms.
“It is certainly in part due to the HST because (of) business tax credits and so on, the input tax credits they get,” Duncan said in an interview.
Of course, it’s not all great news. Ontario continues to have fewer jobs than it did before the recession started, as the government noted in a release yesterday. It would be nice to be able to test Duncan’s assertion against another province without the HST in a similar situation, but frankly, the provincial economies are all apples, oranges and a durian or two. Comparisons aren’t easy between Ontario and, say, HST-less Manitoba.
The bigger problem for the Liberals isn’t the debate over the HST, where none of the parties look good. The problem is that if things are “getting better” at this glacial pace for the rest of the year, it’s hard to see Dalton McGuinty and the Liberals having a good answer to the basic election question: “Are you better off now than you were four years ago?”
