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A Tax Strategy for Ontario


  • Richard M. Bird
  • Thomas A. Wilson

    () (International Tax Program, Rotman School of Management, University of Toronto)


This paper begins by comparing the 1967 Smith committee’s three volume report on Ontario taxation with the 1993 report by the Ontario Fair Tax Commission. These two very different investigations of Ontario’s tax structure, produced in two very different economic and political climates, reached surprisingly similar conclusions. Despite their distinct political origins, both reports explicitly recognized that provincial corporate taxation was (and should be) constrained by the taxation of capital in neighboring jurisdictions, and both also argued for more and better use of user charges (and benefit-based taxes). The paper asks: Has anything changed? Does Ontario need to rethink its tax policy in light of today’s circumstances? Our aim is this paper is threefold: 1) to set out the principles and realities that should govern tax policy in Ontario, 2) to provide an empirical framework with respect both to the size of the fiscal task facing the province over the next decade or so and its “fiscal competitiveness”, and 3) to suggest how best to meet the province’s fiscal needs while simultaneously removing tax barriers to competitiveness and achieving such other policy goals as the equitable sharing of the cost of government.

Suggested Citation

  • Richard M. Bird & Thomas A. Wilson, 2003. "A Tax Strategy for Ontario," International Tax Program Papers 0407, International Tax Program, Institute for International Business, Joseph L. Rotman School of Management, University of Toronto, revised Apr 2004.
  • Handle: RePEc:ttp:itpwps:0407

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    References listed on IDEAS

    1. Jonathan A. Rodden & Gunnar S. Eskeland (ed.), 2003. "Fiscal Decentralization and the Challenge of Hard Budget Constraints," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262182297, January.
    2. Richard M. Bird, 2009. "Taxing Business," World Bank Other Operational Studies 11117, The World Bank.
    3. Chun-Yan Kuo & Thomas Mcgirr & Satya Poddar, 1988. "Measuring the Non-Neutralities of Sales and Excise Taxes in Canada," Development Discussion Papers 1988-08, JDI Executive Programs.
    4. Bird, Richard, 1994. "Decentralizing infrastructure : for good or ill?," Policy Research Working Paper Series 1258, The World Bank.
    5. Richard M. Bird, 2003. "Fiscal Flows, Fiscal Balance, and Fiscal Sustainability," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0302, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
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    Cited by:

    1. Enid Slack, 2005. "Easing the Fiscal Restraints: New Revenue Tools in the City of Toronto Act," International Tax Program Papers 0507, International Tax Program, Institute for International Business, Joseph L. Rotman School of Management, University of Toronto.
    2. Jack M. Mintz & Thomas A. Wilson, 2004. "Assessing Expenditure and Tax Reform Measures: A Review," International Tax Program Papers 0408, International Tax Program, Institute for International Business, Joseph L. Rotman School of Management, University of Toronto, revised Apr 2004.

    More about this item


    Ontario; tax policy; provincial taxation; local taxation;

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue

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