Ontario finance minister calls Trump’s tariffs ‘a wake-up call’ as he teases provincial budget

Ontario Finance Minister Peter Bethlenfalvy watches as Ontario Premier Doug Ford speaks to media at a press conference at the Cool Beer Brewing Company in Toronto, on Wednesday, July 10, 2024. THE CANADIAN PRESS/Cole Burston

Three days before he unveils the provincial budget, Finance Minister Peter Bethlenfalvy says U.S. President Donald Trump’s trade war should serve as a “wake-up call” for Ontario’s economy.

“The status quo is no longer an option,” he said at an event hosted by the Empire Club of Canada on Monday.

“Ontario is facing a challenge like we have not faced in a long time. Our closest ally, the United States, has imposed tariffs on us that are challenging a relationship that was once considered unshakeable,” he said.

Bethlenfalvy will table the provincial budget on Thursday, which he said will be largely focused on the trade war that started in February and has since seen a 25 per cent tariff placed on a long list of Canadian goods sold to the U.S.

“The tariffs are a challenge that none of us has wanted, but we’re going to have to work together to overcome it.”

The budget will be the first of Premier Doug Ford’s third term, after he was re-elected in February on a pledge to support Ontario’s economy in the midst of the tariffs. Ford has said that his government would “not spare a penny” to protect workers and previously stated that Trump’s trade action could cost 500,000 Ontario jobs.

Ford’s government has already made several finance-related announcements against the backdrop of the tariffs, including adding nearly $1 billion over three years to the Skill Development Fund, expanding the Ontario Made Manufacturing Investment Tax Credit, and deferring select provincial taxes for businesses for six months.

While the province’s fall economic statement forecasted a balanced budget by 2026-2027, a prediction made before the tariffs were announced, it appears unlikely the timeline to get out of the red will remain intact.

“We have two choices, right, either start cutting infrastructure and everything else, or you hang in there for a year or two, and we balance,” Ford said last week. “We’ll make up the difference in the next couple years, but it’s about today, right now, how are we going to support these families? So again, Peter, thank you for being understanding and making sure the people of Ontario will always be taken care of.”

Bethlenfalvy said that the provincial government is in a “stronger position” to support workers amid the trade war and hinted that potential tax changes may also be included in Thursday’s budget.

“Some people called for us to cut taxes and cut fees. Well, guess what? We’ve cut taxes and we’ve cut fees. We have never raised a tax or fee, in fact, just the opposite. We’ve been cutting taxes since day one and I’ll have more to say about that on Thursday,” he said in a subsequent fireside chat with CTV Chief Financial Correspondent Amanda Lang.

Pressed for more details on the subject of possible tax cuts, Bethlenfalvy said only: “Stay tuned.”