Ontario’s budget too cautious, auditor general says

Budget lowballs corporate tax revenue, overdoes contingency funding

Ontario Legislative Building at Queens Park in Toronto Ontario

Ontario’s latest provincial budget is too timid in projecting the province’s finances over the next three years, according to the auditor general.

While the April 28 budget provides a “reasonable” forecast, it underestimates tax revenues and is overly cautious about contingency funding, auditor general Bonnie Lysyk said in a statement.

The auditor general suggested that corporate tax revenue estimates are understated by between $1.5 billion and $4.2 billion annually for the next three fiscal years.

“Understating revenues can create a perception that the government has less revenues available when deciding on programs and initiatives, or annual deficit reduction,” Lysyk said.

Additionally, the budget includes higher-than-usual contingency funding of $19.4 billion, compared with $7.5 billion in the 2021 budget, which is “overly cautious,” it said.

The auditor general said that over 80% of the $19.4 billion has not been earmarked for specific programs, “which means that over $15 billion could be spent on unplanned items without impacting projected deficits.”