If you find comfort in fine words, then this Ontario budget is for you! There is a new Northern Ontario Energy Credit but otherwise no relief for higher energy costs nor the proposed imposition of the HST on energy costs.
CARP had advocated for a rebate or tax credit for low income seniors to deal with the added HST burden on home energy costs. Other than the Northern Ontario Energy Credit, no change is proposed for everyone else. And just to rub salt in the wound, the existing Ontario Property Tax Credit will be renamed the Ontario Energy and Property Tax Credit. But that will not make a single cent of difference from the status quo.
When pressed, the Finance officials suggested that the renaming might mean that there will be a re-structuring of the credit to possibly recognize energy costs separately from property taxes and rents. Either we have some faint hope here or the officials just wanted to get me to stop saying: “ I can’t believe there’s nothing for seniors in the budget!” Stay tuned!
The Northern Ontario Energy Credit will provide $130 for single people and $200 for families as an income tested refundable tax credit. The credit would be available to residents in Algoma, Cochrane, Kenora, Manitoulin, Nippissing, Parry Sound, Rainy River, Sudbury, Thunder Bay and Timiskaming. Cheques will be issued in 2010 rather than after the 2010 income tax returns are filed. No details on when the cheques will be in the mail.
The credit would be reduced for a single person with adjusted net income over $35,000 and eliminated when income exceeds $48,000, and reduced for families with adjusted family net income over $45,000 and eliminated when income exceeds $65,000.
The HST will be imposed on a number of services that were previously exempt from provincial sales tax, the most important of which is home energy costs- as identified by CARP ActionOnline readers in our HST survey. Now with the roll-out of the province’s Smart Meters, this increased tax burden will be worse. Here’s why.
The Smart Meter system charges very high rates for electricity consumed during the peak periods of the day – essentially the day time hours, to encourage conservation. However, for older persons who have to stay home all day, and need the heat or air conditioner on or have medical equipment hooked up, energy consumption during the peak periods is not an option. So now with both increased rates and the new provincial sales tax burden under HST, older Ontarians, especially the fixed and lower income groups, will face a significant new burden for which this Budget provides no relief.
The laws governing Ontario’s drug system will be changed to facilitate lower generic drug prices. Ontarians pay more for generic drugs than those in other countries. The government will also increase supports for pharmacies in rural and underserviced areas and support the expansion of clinical services provided by pharmacists. This signals a major opportunity for increasing Ontarians’ access to drugs.