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Raise corporate taxes to fund Toronto subway, Horwath says

Ontario NDP Leader Andrea Horwath speaks at Queen's Park in Toronto on Feb. 18, 2014.

Kevin Van Paassen/The Globe and Mail

Andrea Horwath is calling for Toronto's downtown relief subway to be made Ontario's top transit project and for the province to hike corporate taxes to pay for it.

The NDP Leader's transit-expansion policy, announced Wednesday, appeared calculated to try to hold on to her party's downtown Toronto seats in the face of a push from Premier Kathleen Wynne – who will make building transportation infrastructure a centrepiece of her budget next week – and deflect nagging criticism that the NDP has no plan for transit.

"We need to put the downtown relief line at the top of the agenda," Ms. Horwath said at Queen's Park, flanked by three members of her Toronto caucus. "It is time to get our priorities in order. It is time to get people moving."

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Ms. Horwath said other priorities should be electrifying the new express train from Union Station to Pearson Airport, which will pass through two NDP-held ridings when it opens next year, and building transit in Scarborough. Ms. Horwath said she also supports much of the current Liberal transit plan, including light-rail lines in Mississauga and Hamilton, and along Finch and Sheppard Avenues in Toronto. But extending the Yonge line to Richmond Hill should be put off until the relief line is finished and can take pressure off the crowded Yonge subway, she said.

Ms. Horwath is the last of the three major party leaders to set out a transit-expansion plan.

Ms. Wynne announced a plan last week to spend $29-billion over 10 years to build new subways, highways and express commuter trains. The plan is to be paid for partly by diverting existing gas tax revenues and in part through new "revenue tools" – likely taxes, tolls or asset sales – to be unveiled in the budget.

The Liberals are expected to make a big push for NDP votes, particularly in Toronto, and have repeatedly accused Ms. Horwath of being absent on urban issues. In a statement after the announcement, Transportation Minister Glen Murray said she had been "nowhere" on transit, and also rejected her call for a corporate tax increase.

"Anyone watching this issue for the past year will know that Horwath is scrambling when it comes to paying for transit and transportation projects," he said. "Ontario is emerging from the global recession. However, our recovery remains fragile. This is not the time for across the board corporate tax increases that will dampen growth and further job creation."

The Progressive Conservatives, meanwhile, have pitched a plan to pay for transit by moving other infrastructure projects down the list. Conservative Leader Tim Hudak has also said the relief line is a priority, along with subway extensions to the suburbs.

"Right now, the province spends about $12-billion a year on infrastructure, on capital, on buildings…all you need to do is find 10, 15 per cent of that and prioritize it, and you can actually build subways," he said at a transit photo opportunity last week.

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The Liberals control only a minority of seats in the legislature, and need the support of the NDP to pass a budget and avoid a snap election. The Conservatives have already signalled that they will vote against the budget.

Ms. Horwath would not say how large a corporate tax hike she is asking for. Asked to clarify, she would only say she supported a "modest" tax increase.

At a closed-door meeting with business leaders at Ryerson University last month, Ms. Horwath said she would not support raising corporate income tax back to 14 per cent – the level it was in 2010 before the Liberals started cutting it – but did not specify how high she would be willing to go in between. The current tax rate is 11.5 per cent.

"The corporate sector, which benefits from investments in transit, needs to be part of the solution," Ms. Horwath said Wednesday. "It's a rollback of a tax cut that didn't achieve anything, frankly, for the people of Ontario. These tax cuts were supposed to have created all kind of jobs and investment in our province. They haven't."

Ms. Horwath also called on the government to sell its shares in General Motors to pay for transit, something Finance Minister Charles Sousa has already mused about doing.

And she said the province's new independent budget watchdog should evaluate evaluate transit financing and the province should restore train service to Northern Ontario.

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Follow me on Twitter: @adrianmorrow

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About the Author
Washington correspondent

Adrian Morrow covers U.S. politics from Washington, D.C. Previously he was The Globe's Ontario politics reporter. He's covered news, crime and sports for The Globe since 2010. He won the National Newspaper Award for politics reporting in 2016. More


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