Now that 2018 is in full swing, here’s a breakdown of the largest legal changes taking effect in Ontario starting today.
Minimum Wage Increases to $14
From $11.60, the general minimum wage has now increased to $14 an hour. Liquor servers have their rates bumped up from $10.10 to $12.20 an hour.
Mortgage Rate Stress Test
New mortgage rules now require all purchasers to qualify under a new stress test which will be 200 basis points (2%) higher than your mortgage rate. This means you’ll need more income to close on the same property that you may have been pre-approved for.
As an example, let’s say you’re approved for a mortgage at a rate of 3%. In this case, the bank will finance you as if that rate was 5% meaning your overall mortgage amount (and by extension house budget) will be reduced even though you’d still be paying at the 3% rate and not at the 5% rate.
OHIP+ is Introduced
Under this new pharmacare plan, four million Ontario children, teens and young adults under 25 will have free access to over 4,000 medications. All they have to do is present their health card and valid prescription at any pharmacy for the request to be processed.
Vacation Time Increased
Employees who have been with the same employer for five years are now entitled to three weeks of paid vacation.
Personal Emergency Leave for All
All employers of any sized company must now give all employees 10 personal emergency leave days per year, two of which will be paid if that employee has been employed for one week or longer.
Corporate Tax Rate Cut
The corporate income tax rate for small businesses has been reduced from 4.5% to 3.5%.
Payday Loan Shop Limitations
The cost for every $100 that you borrow at a payday loan shop is reduced from $18 to $15. Then on July 1st, shops cannot lend you more than 50% of your net income per loan and must also show the cost of borrowing as an annual percentage rate in advertising or agreements.
In addition to this, municipalities will have greater control in where payday loan shops can operate as well as limit the number of storefronts.