Duncan updates fiscal plan

Updated video Finance minister Dwight Duncan says Ontario’s deficit will be lower than expected this year thanks to the new surtax on the rich.

Premier McGuinty agreed to increase the tax on incomes over $500,000 to win NDP support for the budget.

Today Duncan announced “every nickel of the new tax will go toward the deficit”, helping reduce it faster than expected. He says for the fiscal year 2011-2012 the projected deficit of $15.3 billion has fallen to $15 billion. For 2012-2013 it has fallen from $15.2 billion to $14.8 billion.

The Liberals were hoping to balance the budget by 2017-2018. Now they say there will be a surplus of a half a billion dollars.

“Ontarians want us to work together they want us to embrace good ideas to move our province forward to reduce the deficit. In the context of this minority government we’ve been able to move our budget forward with no new spending and if it passes as it stands now we will be eliminating the deficit faster.”

Duncan also says the overall debt will be reduced by $3.5 billion dollars by 2018, but it’s expected to continue to grow to about $264 billion by that time.

Video: Melissa Raftis reports: