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Vancouver, BC - The average Canadian family spends more money on taxes than on necessities of life such as food, clothing, and housing, according to a study from The Fraser Institute, an independent research organization with offices across Canada.
The Canadian Consumer Tax Index, 2007, shows that even though the income of the average Canadian family has increased significantly since 1961, their total tax bill has increased at a much higher rate.
In 1961, the average Canadian family earned an income of $5,000 and paid $1,675 in total taxes -- 33.5 per cent of its income.
In 2006, the average Canadian family earned an income of $63,001 and paid total taxes equaling $28,311 -- 44.9 per cent of its income.
“The tax burden we face is made up of much more than just income tax. When you add up all the taxes we have to pay to all levels of government, the average Canadian family is paying more of its income to governments in the form of taxes than they spend feeding, clothing and housing themselves,” said Niels Veldhuis, the study’s co-author and Director of the Centre for Tax Studies with the Fraser Institute.
The Canadian Consumer Tax Index calculates the total tax bill of the average Canadian family by adding up the various taxes that the family pays to federal, provincial, and local governments. These include direct taxes such as income taxes, sales taxes, Employment Insurance and Canadian Pension Plan contributions, and “hidden” taxes such as import duties, excise taxes on tobacco and alcohol, amusement taxes, and gas taxes.
“As Canadians grapple with the stress and anxiety of completing their income tax returns, any discussion of taxes naturally tends to focus on income taxes. But personal income taxes account for only 32 per cent of the total taxes the average Canadian family paid in 2006,” Veldhuis added.
The Canadian Consumer Tax Index attempts to answer the question: How has the tax burden of the average family changed since 1961?
The study found the increase in the total tax bill means the average family now pays more money to various levels of government for taxes than it spends on food, clothing and housing combined.
In 1961, the average family had to spend 56.5 per cent of their cash income to obtain food, clothing and housing. In the same year, 33.5 per cent of the family’s income went to governments as tax.
By 1981, the situation had been reversed; governments took 40.8 per cent of the income in the form of taxes, while the family used 40.5 per cent to buy food, clothing and housing.
By 2006, the average family was giving 44.9 per cent of its income to governments for taxes while using 35.6 per cent of its income to buy the necessities of life – food, clothing and housing.
Since 1961, the total tax bill for the average Canadian family has increased 1,590 per cent. By comparison, the cost of housing has increased 1,019 per cent, the cost of food 487 per cent and the cost of clothing has increased 447 per cent since 1961.
“Over the past 45 years, taxes have become the single largest expenditure in an average Canadian family’s budget with the total tax bill for a typical family increasing by 1,590 per cent since 1961,” Veldhuis said.
With population growth, shouldn't it be a downward trend, not an upward trend?
It certainly shows tax loads have increased at a higher rate than the cost of necessities, which shouldn't be all that shocking when one considers how the expectations and demands of the populace for various government services has also risen.
Might be signifigant that the study takes into account alltaxes, particularly municipal taxes which are collected in the form of property tax.
Property tax is usually based the assessed value of a property. Property taxes in urban areas tend to be much higher than in rural areas simply because the level of service provided in the urban setting is substantially greater.
Over the last 40 years there has been a signifigant shift in population densities with the number of people living in rural areas declining while urban areas have seen great population expansion.
Be interesting to see a breakdown as to what taxes in particular have risen the most both from a percentage view and a total revenue view.
On the other hand, crikey, I don't see too many skinny, naked people walking the streets, so I guess most folks are still managing to eat and stay decent.
Having been born in Canada- (vancouver island) I am well aware of the taxes. Never did like the GST -( Good socialist tax) then theres the PST. When I had my business I had to always figure out GST input and output tax credits which became a nightmare - a seperate expense the accountant had to charge me just to figure out. - and had to be filed every 3 months! talk about b.s!!! VAncouver Island I would say by far is the best place to live in all of Canada with the most moderate temp's especially during the winter. When I sold my property I sold for 815 k - which was back in 2003 now it has almost doubled and worth about 1.4 million. I couldn't believe howmuch prices skyrocketed after I just checked. Vancouver Island waterfront is becoming very expensive. Also how strong the dollar is compared to the Greenback. I moved to U.S 3 years ago and I must say I don't miss the Canadian pollitics one bit or the taxes for that matter. Quality of living and location on the other hand great! Scenery beats them all. Vancouver Island I would say is the nicest Island in all North America in terms of Topography and scenes of nature. I always liked taking long walks on the beach early in the morning without seeing a soul during summer or winter months. Winter months you get that damp cold you have to get used to but summer months are not humid and humidity is low. I never got a chance to kiyak the broken Islands - always something I wanted to do on my list oh well maybee sometime. There was always so much to do for outdoor activities. The natural resource sector including the oil sector from Alberta seems to really be helping Canada economically right now. Canadians have no deficit since the GST seems to have payed alot of royalties to the gov't. Health care though still remains a problem - didn't really affect me much though since I didn't get into anyting serious and health care was inexpensive. For the joe blow not making alot of money Canada is the place to be cause of its social benefits. Higher income earners beware ! or try to hide your money and even that is tough. I am well aquainted with the Frazer Institute - they tend to be libertarian in their outlook on things - I always admired them alot for a trustworthy news source out of Canada. All in all couldn't find a more beautiful place to live then Vancouver Island only other place that can compete with Beauty and that may even be nicer is New Zealand. With the coming of the Olympics realestate values will go even higher I'm afraid.
On the other hand, crikey, I don't see too many skinny, naked people walking the streets, so I guess most folks are still managing to eat and stay decent.
LOL! Dude, your sense of humor is just phenomenal.
I am well aquainted with the Frazer Institute - they tend to be libertarian in their outlook on things - I always admired them alot for a trustworthy news source out of Canada.
I guess that's what it is -- a libertarian view on taxes. Not that there's anything wrong with that. Like yourself, I do believe it's pretty accurate, though. But man, how does one save any money on retirement and children's college fund when almost half of one's salary goes to the government? I guess it's pretty tough.
This does not in ANY WAY surprise me! Isn't Canada now the highest taxed nation? I don't even live in Canada anymore and am still forced to pay Canadian taxes!!! It's truly as you said...a JOKE!!
This does not in ANY WAY surprise me! Isn't Canada now the highest taxed nation? I don't even live in Canada anymore and am still forced to pay Canadian taxes!!! It's truly as you said...a JOKE!!
May I ask why you choose to pay taxes in Canada but not live in Canada? Isn't it that you're only supposed to pay taxes in Canada if you are a considered a resident of a particular province? That means, being present in Canada for 183 days out of any calendar year. If you live outside of Canada full-time, I don't think you're required to pay income taxes. Unless, of course, you have a health insurance card which would, technically, tie you with a certain province. But even then, it would have to show that you were actively using it, should an audit be necessary.
The only way you can possibly own taxes to Canada is if you own property there , own investments - which you must pay additional foreign tax for - U.S has a reciprocal agreement with the CAn gov't there. Or you still own a business there or receiving pension checks or other supplimentary income there. My biggest beef when I left B.C was having to pay proerty taxes the same year I left to the U.S to sell my house in 2003. I didn't even become a U.S non resident at that time yet. Liquadating my RRSP investments was a joke - taxed through the roof!!!
May I ask why you choose to pay taxes in Canada but not live in Canada? Isn't it that you're only supposed to pay taxes in Canada if you are a considered a resident of a particular province? That means, being present in Canada for 183 days out of any calendar year. If you live outside of Canada full-time, I don't think you're required to pay income taxes. Unless, of course, you have a health insurance card which would, technically, tie you with a certain province. But even then, it would have to show that you were actively using it, should an audit be necessary.
No audit PLEASE!!! I don't need the headache!!! I do have property in Canada and work there as well. That's why I pay the taxes and am still able to use my health care. We live on a border town so Canada is only a 2-3 mile drive north. It's only for a little while longer though...then I will FINALLY be rid of Canadian taxes!!! No worries...I'm not doing anything illegal. I can't anyways since my husband is a Fed. Officer...would kinda make him look bad and possibly lose his job.
Maybee thats why there's so many cash crops in B.C or all of Canada for that matter. In Vancouver alone - this was going back some years ago they estimated up to 6000 grow shows - out of rental houses, appart suites and houses, warehouses combined!
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Yes its true
