Summary of Ontario’s 2025 Fall Economic Statement

We want to share an overview of how the recently announced summary of Ontario’s 2025 Fall Economic Statement and how it addresses the province’s economic challenges. ​

Key Highlights

1. Deficit and Economic Outlook

   • Ontario’s deficit for 2025-26 is projected at $13.5 billion, an improvement from the $14.6 billion forecast earlier this year. ​ The government aims to balance the budget by 2027-28, with a projected surplus of $0.2 billion. ​
   • Real GDP growth is expected to slow to 0.8% in 2025 and 0.9% in 2026, reflecting economic headwinds from U.S. tariffs and trade uncertainty. ​

2. Jobs and Employment

   • The unemployment rate is expected to rise to 7.8% in 2025, up from 7% in 2024, with sluggish recovery anticipated in the coming years. ​
   • The government is investing in programs to support workers and businesses affected by tariffs, but critics argue there is no comprehensive jobs plan. ​

3. Construction and Housing Starts

   • Ontario is projecting 64,300 new homes to be built in 2025, a decrease from 74,600 in 2024. ​ This is significantly below the pace required to meet the government’s target of 1.5 million new homes by 2031. ​
   • The government plans to waive the 8% provincial portion of the HST for first-time homebuyers purchasing new homes valued up to $1 million, potentially saving up to $80,000 per home. ​

4. Manufacturing and Tariff Relief ​

   • The Ontario Made Manufacturing Investment Tax Credit (OMMITC) will be temporarily enhanced, increasing the tax credit rate from 10% to 15% to support manufacturers. ​

5. Addressing Tariffs

   • The Ontario Together Trade Fund (OTTF) will receive an additional $100 million, bringing total funding to $150 million over three years. ​ This fund aims to help small and medium-sized enterprises diversify into new markets and strengthen trade resiliency. ​
   • The $5 billion Protecting Ontario Account continues to support sectors impacted by U.S. tariffs, such as auto, steel, aluminum, and copper industries. ​

6. Infrastructure Investments

   • The government plans to invest over $201 billion in capital projects over 10 years, including $33 billion in 2025-26, to support highways, transit, and other infrastructure. ​

7. Other Measures

   • $1.1 billion will be invested in home care services over three years to ease pressure on hospitals and long-term care facilities. ​
   • Changes to election rules, including scrapping fixed election dates and raising political donation limits, were introduced. ​

Economic Impact

The fiscal update aims to address economic challenges by supporting businesses affected by tariffs, enhancing tax credits for manufacturers, and investing in infrastructure and home care. ​ However, concerns remain about high unemployment, slow housing starts, and limited new investments to stimulate growth. ​