Your taxes are costing you more than the necessities of life, finds a new report from the Fraser Institute.
As authors Jake Fuss and Leo Plumer calculate, over the last year the average Canadian family earned $96,333 and paid $35,047 in taxes, or 36.4 percent of their income.
For basic necessities—housing (including rent and mortgage payments), food and clothing combined — families paid $34,105, or 35.4 percent of their income.
In order to get a sense of how the average family’s tax bill has changed over time, Fuss and Plumer have constructed an index for the period from 1961 to 2020 called the Canadian Consumer Tax Index.
Since 1961, and including all types of taxes, the tax bill has increased by 1,992 percent. This is much more than any other single expenditure over that period. Shelter increased by 1,671 percent, clothing by 629 percent, and food by 767 percent.
The tax bill has also greatly outpaced the increase in the Consumer Price Index, which measures the average price that consumers pay for food, shelter, clothing, transportation, health and personal care, education, and other items, and which increased 773 percent.
This has not been unaffected by the pandemic, however. Fuss and Plumer note that there was a sharp drop-off in the tax bill from 2019 to 2020. This was an isolated incident due to the specific economic and fiscal circumstances of the pandemic, they write.
Whether or not this overall tax bill continues to rise should be a contested issue that will be determined in large part by the outcome of the upcoming federal election.
