TORONTO - NDP Leader Andrea Horwath says her party is committed to raising the minimum wage in Ontario to $12 an hour over two years while simultaneously appeasing employers with cuts to the small business tax.

In trying to walk a fine line, Horwath says the New Democrats will be "sensitive" to the impact a higher minimum wage would have on job creators.

She says her plan would involve a gradual increase over the next two years while also tying the raise to inflation to ensure a fair minimum wage in the future.

The Liberal government, in the budget they released last week, had proposed raising the minimum wage to $11 an hour on June 1, with legislation planned to index it to inflation.

Both Horwath and the Progressive Conservatives refused to support the fiscal plan, setting the stage for the June 12 election.

Horwath says New Democrats would also reduce the small business tax rate to three per cent over two years -- a move she says would help them absorb the impact of higher wages.

She says such an approach would help businesses who have had a hard time dealing with "other impacts" such as rising electricity rates under a Liberal government.