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Ontario’s 2023 Economic Outlook: Building a Stronger Future Together

Ontario’s economic landscape is set for significant developments as Minister of Finance Peter Bethlenfalvy unveiled the province’s 2023 economic outlook and fiscal review on November 2, 2023. Under the banner of “Building a Stronger Ontario Together”, this year’s statement not only reflects stability in tax rates but also introduces strategic enhancements aimed at fostering growth and improving services for the residents of Ontario.

Maintaining Stability in Tax Rates

A key takeaway from the provincial government is the decision to maintain current personal and corporation income tax rates. This move signals the government’s commitment to provide a stable financial environment, crucial for both individuals and businesses in navigating the economic landscape. As of the date of publication of this articles, Ontario small business corporation is subject to a favourable tax rate of 12.2% (Federal + Provincial) while a medium to large size corporation is subject to a tax rate of 26.5%.

Enhancing Tax Credits and Rebates
  1. Ontario Focused Flow-Through Share Tax Credit: The province is set to expand the eligibility of this refundable tax credit to include specified critical mineral exploration expenditures. This expansion aligns with the federal Critical Mineral Exploration Tax Credit for expenses renounced on or after January 1, 2023, marking a significant step towards supporting mineral exploration in Ontario. However, for high net-worth individuals planning to invest in tax shelters, it is important to note that the provincial tax credits only apply to investors who reside in the same province as where the exploration activities took place. If a Ontario tax resident purchase an investment where the mineral exploration activities occurs in Manitoba, then the provincial tax credits will not be available. In some cases, this represents a 50% reduction to the tax benefits from investing in a tax shelter.
  2. Ontario Harmonized Sales Tax (HST) Rebate for Rental Housing: In a notable move to bolster the real estate sector, Ontario proposes to enhance the New Residential Rental Property Rebate. This enhancement equates to a 100 percent rebate of the provincial portion of the HST paid for qualifying new purpose-built rental housing, with no maximum rebate limit. This initiative, complementing the federal GST/HST rebate, effectively removes the full 13 percent HST on qualifying new rental housing, applicable to projects commencing between September 14, 2023, and December 31, 2030, and completed by December 31, 2035. Unfortunately, this rebate only applies to new construction projects. For construction projects started before September 2023, a maximum rebate of $24,000/$16,000 per rental unit still applies.
Temporary Tax Cuts and New Agreements

The government is also extending the Temporary Gas Tax and Fuel Tax Cuts until June 30, 2024. This extension keeps the tax rate on gas and fuel at a reduced nine cents per litre, easing the financial burden on consumers.

Additionally, Ontario is entering into a Coordinated Vaping Product Taxation Agreement, aligning with the federal government’s initiative to levy an additional excise duty on vaping products sold in Ontario. This move will not only contribute to public health efforts but also generate additional revenue for the province.


Ontario’s 2023 economic outlook presents a balanced approach, prioritizing stability while strategically enhancing certain tax credits and rebates to stimulate growth and investment in key areas. These measures, alongside efforts to ensure tax compliance and integrity, lay the groundwork for a stronger, more prosperous Ontario. As these policies unfold, they are poised to shape the province’s economic trajectory in the coming years.