TORONTO -- Ontario's Liberal government delivered its 2016-2017 budget on Thursday. Here are five things you need to know about the fiscal plan.
POST-SECONDARY STUDENTS: College and university students from low-income families stand to benefit the most from the Liberal government's fiscal plan. Starting in the 2017-18 school year, the province will create a new grant -- called the Ontario Student Grant. Under the new system, tuition will be free for students from Ontario families with incomes up to $50,000 who attend any college or university in Canada. More than half of students from families with incomes up to $83,000 will receive non-repayable grants that exceed the average tuition -- mostly students who live on their own. No Ontario student will receive less through the new grant than they are currently eligible for through the Ontario Tuition Grant.
CAP AND TRADE: Proceeds from the cap-and-trade system -- which is designed to reduce Ontario's greenhouse gas emissions -- are projected to be $1.9 billion in 2017 -- up from last year's projection of $1.3 billion -- and will be used to invest in green projects and climate change initiatives. However, the program comes at a cost to Ontario ratepayers. The average natural gas cost to households will increase $5 per month, while the price of gasoline will go up about $4.3 cents per litre -- or about $8 per month.
CIGARETTES AND WINE: The prices of cigarettes and wine are going up. There will be a $3 increase in the price of a carton of 200 cigarettes, effective at 12:01 a.m. Friday, and the tobacco tax will keep rising at the rate of inflation each year over the next five years. The minimum price for a bottle of wine rises to $7.95 over the next three years, and there will be a series of increases in the ad valorem tax on wine, starting with a two percentage point hike in June, another two points in 2017 and 2018, and a one-point hike in 2019
DEFICIT: The budget deficit for fiscal year 2015-16 is expected to come in at $5.7 billion, down from the last estimate of $7.5 billion. The deficit for 2016-17 is projected to come in at $4.3 billion and be eliminated the following fiscal year, as promised. The sale of government assets and proceeds from carbon pricing are expected to help the Liberals meet that goal.
NET DEBT: Ontario's net debt, which currently sits at $296.1 billion, is expected to hit $308 billion -- or $22,103 for every person in Ontario -- in 2016-17, making the province the largest sub-national borrower in the world. Interest payments will cost $11.8 billion this year and are expected to increase to $13.1 billion by 2018-19.
