Ford plans tax cuts for minimum wage earners

PC leader says the move would ‘put money back into your pocket’

Putting meat on the bones of a promise to ease taxes for the poor, Doug Ford says he would provide an income-tax credit for minimum-wage earners if a Progressive Conservative government is elected on June 7.

Ford, who has pledged to freeze the benchmark at $14 by axing the Wynne government’s plan to raise it to $15 in January, said his tax move would save about $817 a year for a full-time, minimum-wage earner making $28,000 over 50 weeks.

“Our plan is to put money back into your pocket instead of the government’s, put money back into the businesses’ pockets, so they can thrive and get ahead and hire people,” he told supporters Monday at an Ottawa restaurant.

But the Canadian Centre for Policy Alternatives said minimum wage workers would be better off with the $1 hourly increase because most don’t pay income taxes thanks to deductions for child care, dependents and medical expenses.

“What you’re comparing is the increase in the minimum wage versus the reduction in taxes,” economist Sheila Block said in an interview Monday, saying the $1 minimum wage increase is worth $1,950 a year before taxes for a 37.5-hour work week.

“You still wind up being about $1,100 ahead with the move to $15 rather than with this tax credit.”

Conservatives and some business groups have argued the steep rise in the minimum wage to $14 this year, from $11.40, has hurt small employers. They also contend the additional $1 increase is a disincentive for hiring more staff and could lead to job cuts.

Previously Ford had said income tax would not apply to Ontarians earning less than $30,000 a year and accused Premier Kathleen Wynne of raising the minimum wage so the government could bring in more tax revenue. NDP Leader Andrea Horwath, who would also raise the minimum wage to $15 next year, dismissed Ford’s pledge as “bumper-sticker talk.”

“People who are making the minimum wage don’t even pay taxes at this point in time and (under) Doug Ford’s plan — by driving down the minimum wage even further — they’re not going to be in the position to be paying income taxes in the first place,” she said.