It’s more than affordable to start and run a business in Ontario; it’s cheaper than in many other places. In fact, our country as a whole has proven to be a cost-effective centre for business. KPMG's 2010 Competitive Alternatives study of international business costs identifies Canada as among the most affordable countries in the G7, with business costs over two per cent lower than in the United States. In the IMD World Competitiveness Scoreboard 2011, Canada placed 7th out of 58 countries.
When you do business in Ontario, your bottom line benefits from our:
A Highly Competitive Tax Environment
Ontario’s tax programs provide a big boost for business, helping them thrive and driving investments in innovation. When you bring your business to Ontario, you enjoy the advantages of:
- Corporate income tax (CIT, provincial and federal combined) that’s lower than the average of G8 and G20 countries and lower than the average federal-state CIT rate in the United States.
- Employer payroll tax rates (total of pension, health and unemployment) that are among the lowest of the G7 countries.
- Personal income tax rates for people earning $60,000 that are comparable to rates in the U.S., Japan and France, and considerably lower than rates in Ireland, Italy and Germany.
- Harmonized sales tax (HST), which cuts tax compliance costs, gives companies credit for sales tax they pay on various purchases and capital investments, and reduce layers of taxes buried in supplier prices.
- Ontario’s R&D Tax Program, which can reduce the after-tax cost of every $100 spent in R&D to between $55 and $37, when combined with federal R&D tax incentives. Learn more about Ontario’s R&D Tax Program.
- Relief from capital taxes – an aggregate annual tax burden of about $1.6 billion –which were eliminated in July 2010.
- Apprenticeship Training Tax Credits, which can earn employers up to $40,000 in tax credits for every apprentice they train. Learn more about Apprenticeship Training Tax Credits.
- Co-operative Education Tax Credit, which gives businesses up to $3,000 in tax credits for every student they hire as part of a co-op program. Learn more about the Co-operative Education Tax Credit.
Ontario also has a number of targeted tax incentives that can help emerging industries expand, including:
Low Labour Costs
Source: Ontario Ministry of Finance, Ontario Economic Accounts, Second Quarter of 2011
Companies in Ontario save on mandatory contributions to pension, health and unemployment insurance. Thanks to publicly funded health care, common employer-sponsored benefits in Ontario are approximately one-third of U.S. costs. In Ontario, a typical company with close to 100 employees pays about US$259,000 per year for employee health care, compared to US$783,000 in the U.S.
Labour costs on a national level also compare favourably against costs in other countries.
An Abundance of Land and Buildings
Ontario is huge, spanning more than one million square kilometres. To get a more concrete idea of just how big we are, put France and Spain together; Ontario’s roughly as big as these two countries combined. We’ve got plenty of space for your business –and lots of room to grow. Toronto alone boasts close to 40 per cent of the total office spaces in Canada and has North America’s third highest amount of industrial space. Whether you're looking for raw land or turnkey facilities, finding an ideal location for your business is easy in Ontario.
Find the best location for your business today with Select Ontario, a free site selection tool with the latest information about available commercial properties.
Dependable and Affordable Energy and Utilities
Whether it’s electricity to run your factory or fuel to move your cars and trucks, Ontario has the dependable and affordable energy you need to power your business. Our diverse energy mix includes electric, nuclear, natural gas, oil and renewables. Our wholesale electricity prices are consistently lower than in neighbouring markets while our average gasoline end-use prices are the second lowest in the G7.
Since 2007, we’ve invested more than $17 billion to increase our electricity capacity, strengthen our transmission system and secure our energy supply. Almost all of the energy consumed in Ontario is generated in Canada, the world’s third largest producer of oil and fourth largest producer of natural gas.
Visit Ontario’s Ministry of Energy to learn more about the province’s energy industry and long-term energy plan. Electricity demand and wholesale pricing information is available at the Independent Electricity System Operator website.
