Summary
On April 23, 2015, Minister of Finance Charles Sousa introduced the 2015 Ontario Budget.
Overall, Budget 2015 was generally good for Ontario REALTORS®. The budget does not signal any intention to move forward with giving additional revenue tools, such as the municipal land transfer tax, to municipalities. Unfortunately, the budget made no commitment to move forward on personal real estate corporations (PRECs). However, the budget commits the government to a review of corporate/business legislation in the near future.
Budget 2015 outlines the government’s plan to create jobs and grow the economy, invest in major infrastructure projects, reform beer and alcohol sales, maximize the value of government assets and improve retirement for Ontarians.
The Budget and Ontario REALTORS®
- Budget 2015 does not commit to giving municipalities additional revenue tools, such as municipal land transfer tax. Instead, the government is encouraging them to find additional financing tools, such as asset optimization.
- The budget does not permit the use of Personal Real Estate Corporations(PRECs) by real estate Salespeople or Brokers. However, the budget does commit the province to a full review of business/corporate legislation to explore innovative business practices.
- Budget 2015 commits to implementing two key recommendations from theMortgage Brokerages, Lenders and Administrators Act (MBLAA) review. Specifically, the government will strengthen fraud prevention measures and prohibit advance fees for arranging mortgages of less than $400,000 – an increase from the current $300,000 threshold.
- Ontario will move forward with a cap-and-trade system as its carbon pricing mechanism. The government will invest proceeds from the new cap-and-trade program to support improving energy efficiency for homes.
OREA will also oppose any efforts to introduce mandatory home energy audits.
- The budget announces the government’s commitment to exploring the possibility of allowing the self-employed (a taxation category that includes REALTORS®), to participate in the Ontario Retirement Pension Plan (ORPP). The budget also reaffirms the government’s plan to permit Pooled Registered Pension Plans (PRPP) as a retirement tool for Ontarians.
- The government announced that they will move ahead with the modernization of the Condominium Act, 1998. If passed, the new legislation will establish mandatory qualifications for condominium managers and create two new administrative authorities to license condominium managers, improve education and dispute resolution for condominium boards and owners.
- The government will launch consultations to determine whether to create a growth plan for Eastern Ontario.
- The government will remove the Debt Retirement Charge from residential electricity users’ bills after December 31, 2015.
Other important highlights from the 2015 Ontario Budget include:
- The budget increases the dedicated funds for Moving Ontario Forward by $2.6 billion for a total of $31.5 billion over 10 years. Sixteen billion of these funds will be invested in transit projects in the Greater Toronto and Hamilton Area (GTHA).
- The government is projecting a deficit of $8.5 billion for the current fiscal year. In 2016-17, the deficit will reduce to $4.8 billion and the budget will return to balance in 2017-18.
Please note the budget must be passed by the legislature before it is adopted.
For more information on the 2015 provincial budget, please visithttp://www.fin.gov.on.ca/en/budget/ontariobudgets/2015/