Ontarians, will you be donating your tax return to the government?

When you ask Ontario residents whether they would donate their tax refund back to the provincial government, the answer you generally hear is a resounding, “no.” But the option is still there.

The Ontario Opportunities Fund gives the “opportunity” for Ontarians to donate all, or a portion, of their tax refund back to the provincial government to help them clear Ontario’s debt and pay down the deficit.

The fund was established by Mike Harris’ Progressive Conservative government in 1996 and introduced as part of the provincial budget as a means to pay down the deficit incurred by the previous government headed by Bob Rae’s NDP. At the time, it was another facet of the austerity measures instituted by the Harris Government’s “Common Sense Revolution,” but these days it makes little sense to most people.

Ask Ontario’s tax payers whether they would donate and most will scoff, citing the Gas Plant Cancelation Scandal, the eHealth Scandal and the Ornge Scandal as examples of government financial irresponsibility.

Left-wing citizen advocacy group The Canadian Taxpayers’ Federation [CTF] agrees.

How it works

“The Ontario Opportunities Fund is voluntary and I guess you can throw your money out the window if you want because that’s what you’re doing when you donate to this fund,” says Christine Van Geyn, CTF’s Ontario director. “What it’s able to raise is a drop in the bucket when compared to Ontario’s total deficit. If you flush your money down the toilet, it would have the same impact.”

At the time of writing, Ontario’s total debt is $296.1 billion for 2015-2016 and is projected to grow to $326.8 billion by 2018-2019. Meanwhile, since its first year of operation ending March 1997, the Ontario Opportunities Fund has only been able to raise $2.8 million.

Over the 19 years the fund has been active, only 37,773 taxpayers have actually donated to it and they all did it one of two ways.

“Individuals can indicate how much you want to donate by either redirecting an income tax refund or by sending a cheque or money order to the province,” says Michael Patton, spokesperson for the Ontario Treasury Board Secretariat, which manages the Opportunities Fund.

In return you get a non-refundable tax receipt, but not much else for your generosity – not even a break on the taxes you could owe in the future. Plus, there’s no way to trace the money or specify the part of the provincial debt you want your money to tackle.

“The donated amounts are credited to the Ministry of Finance under the Treasury Program that is responsible for managing the debt of the Province. These amounts are used for reducing Ontario’s deficit and debt and not allocated towards any specific program,” says Patton. For many people that ambiguity is a problem, even those who would otherwise be fine with giving the government more money.

“I’d be okay with paying higher taxes if it was going to get us a subway relief line or more protected bike lanes, but paying off debt isn’t exciting. I don’t know how it all works, but if our governments are borrowing money from the Bank of Canada, I feel like they shouldn’t have to pay it back with interest,” says Richard Vaughan, a travel agent from Toronto.

Is it worth it?

Meanwhile, Ontario has one of the highest combined statutory income tax rates in the world at 53.53 per cent and is only edged out by Nova Scotia at 54 per cent in Canada.

“The government is not faced with a revenue problem, it’s faced with a management and spending problem,” says Van Geyn who also pointed out that Ontario is facing their ninth consecutive deficit budget, which she says shows the province hasn’t learned from its spending mistakes.

“I don’t know anyone personally who has donated to the Ontario Opportunities Fund, but the real way to tackle a deficit isn’t by relying on taxpayers for more money through higher taxes and things like the Opportunities Fund, it’s by managing their spending and reducing interest rates,” she continued.

But people do donate and though the Ontario Treasury Board cannot release a donor’s personal information for confidentiality reasons, Patton says these donations are often given as a thanks and recognition for providing grants, supports and assistance through ministry programs that the donors or their families have personally benefited from. Still, Van Geyn believes that money could be put to better use if it was donated to charity or an independent non-profit organization.

“My advice for people is to consider other charities that exist in Ontario and write to your member of provincial parliament and tell them it’s their responsibility to tackle the debt and the deficit and stop relying on Ontario’s taxpayers through high tax rates and the Opportunities Fund,” she says.