GREENSTONE, ON – October 12, 2010 ----- Finance Minister Flaherty said Canada's federal deficit rose to its highest level in history thanks in part to $5.6 billion in extra "incentive" spending to get the governments of Ontario and B.C. to adopt the Harmonized Sales Tax. It was accounting for these HST transfer payments that helped push the budget deficit into record-breaking territory.
MP Bruce Hyer reacted with shock at the federal government’s latest fiscal update, which revealed a deficit billions larger than originally estimated. On Tuesday, Finance Minister Jim Flaherty said that revised federal numbers now show an actual deficit of $55.6 billion, and that it would take at least five years to return to balanced budgets.
“A deficit this large will be a monkey on the back of the Canadian economy for decades to come.” said Hyer from a ‘Cost of Living’ town hall tour in Greenstone. “The worst part is it didn’t have to be so bad. The Harper government insisted on $12 billion in across-the-board corporate tax cuts that are completely unaffordable right now. Only the most profitable corporations, like the big banks and oil companies, will benefit from them because they’re the ones making huge profits - and they don’t need them. The small and medium-sized businesses that have created much of our jobs over the last decades won’t benefit if they don’t make any money. This kind of reckless fiscal mismanagement just doesn’t make sense.”
“This is truly mind-boggling.” said Hyer “We’re being charged much more for things under the HST, and now we’ll be forced to pay more again to pay back the money borrowed to implement the tax hike in the first place! It’s so nuts it makes your head spin. How many years will our children and grandchildren be burdened with not just the HST, but the debt incurred to impose that tax on us all?”
This year’s budget deficit topped the previous 1993-94 deficit record by $13 billion.