Taxes trump living costs in Canadian family budgets: report - MoneySense

Taxes trump living costs in Canadian family budgets: report

A Fraser Institute study shows taxes growing as percentage of income

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TORONTO (NEWS680) — A new study finds Canadians are paying more than 40 per cent of their income on taxes, compared to just under 40 per cent on the basic necessities of life.

The Canadian Consumer Tax Index by the Fraser Institute, which was released on Thursday, looked at tax bills from 1961 to 2016.

Last year, the average Canadian family earned $83,105 but paid $35,283 in taxes compared to $31,069 spent on housing, food and clothing combined.

Canadians spent 42.5 per cent of their income on taxes and 37.4 per cent on basic necessities, which include food, clothing and housing, the report found.

In comparison, back in 1961, the average Canadian family spent 33.5 per cent on taxes and 56.5 per cent on food, clothing and housing.

“Taxes help fund important public services that Canadians rely on, but the issue is the amount of taxes governments take compared to what Canadians get in return,” said Charles Lammam, a co-author of the report.

“With more than 42 per cent of their income going to taxes, Canadians might ask whether they’re getting good value for their tax dollars.”

According to the report, taxes have grown more rapidly 1961 to 2016 than any other household expense. Money spent on housing increased by 1,527 per cent, clothing by 677 per cent, and food by 639 per cent.

In the same time period, the tax bill has risen by 2,000 per cent. The increase in the tax bill outpaced the rise in the Consumer Price Index.

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