On March 26, 2026, Minister of Finance Peter Bethlenfalvy released the 2026 Ontario Budget: A Plan to Protect Ontario. According to the Ministry, the budget is designed to protect workers and businesses amid economic uncertainty, while continuing to build Ontario, protect services, control costs, and support communities.
What Matters Most to General Contractors
Tax Relief and Investment Incentives
- HST relief for new homebuyers: Removal of the full 13 per cent HST on eligible new homes valued up to $1 million, providing up to $130,000 in relief per buyer. The rebate is maintained for homes up to $1.5 million. Subject to federal legislation, cost-sharing with the federal government would deliver nearly $2.2 billion in joint housing tax relief.
- Small business tax cut: Proposed reduction of the small business corporate income tax rate from 3.2 per cent to 2.2 per cent, effective July 1, 2026. More than 375,000 Ontario small businesses would benefit, with $1.1 billion in tax relief over three years.
- Accelerated capital cost allowances: Businesses would be permitted to accelerate income tax deductions for depreciable assets, aligning with federal measures and reducing the cost of capital investment.
Major Infrastructure Investments
- $210+ billion provincial capital plan over 10 years, including $37 billion in 2026–27, focused on highways, transit, hospitals, and community infrastructure.
- $300 million over six years through the Community Sport and Recreation Infrastructure Fund, bringing total program investments to $500 million.
- $64 billion in health infrastructure over the next decade, supporting more than 50 hospital projects and approximately 3,000 new hospital beds.
- $30 billion over 10 years for new and redeveloped schools and child care projects.
Economic Growth and Strategic Projects
- Protect Ontario Account Investment Fund: Up to $4 billion to attract pension funds and private capital for strategic, long-term economic priorities.
- $107 million over three years to renew the Critical Technologies Initiatives program, supporting sectors such as advanced manufacturing, automotive, mining, life sciences, and smart infrastructure.
- Billy Bishop Airport modernization: Proposed legislation to support expansion, reduce congestion at existing airports, and create construction and related-sector jobs.
Housing and Community Support
- Provincial collaboration with municipalities that reduce development charges to accelerate housing construction.
- Expansion of adult correctional facilities to meet forecasted demand.
- A new long-term funding model for postsecondary education, delivering $6.4 billion over four years and increasing annual operating funding by 30 per cent.
Fiscal Snapshot
- 2025–26 deficit: $12.3 billion (an improvement of $2.3 billion from 2025 projections)
- Path to balance maintained, with a projected surplus in 2028–29
- Net debt-to-GDP ratio: 36.8 per cent, remaining below the 40 per cent target
OGCA Perspective
While acknowledging the continued economic challenges facing the province, the OGCA believes this budget represents an important investment in the ongoing growth of Ontario’s infrastructure, support for small businesses, and a much-needed boost to residential construction.
Questions?
Contact Andrew Sampogna at andrew@ogca.ca
