'Tax Freedom Day' is later than last year: Fraser Institute
June 9 marks the point when the average Canadian has paid off the year’s tax load and will begin pocketing his or her own money, according to the Fraser Institute.
But “Tax Freedom Day” is arriving one day later than last year’s date of June 8 because the average Canadian family’s total tax bill is expected to increase faster than its annual income, economic policy expert Charles Lammam told CTV’s Power Play.
Lammam notes that while total taxes will increase by 3.2 per cent over the last year, the average Canadian family’s income will only increase by 2.1 per cent.
He said that a large majority of the tax increase stems from governments spending beyond their means and incurring deficits.
“It’s typically coming from the provincial governments. What we’ve noticed now over the last several years is that many governments are in deficit -- so they’re spending more money than the revenues that they collect,” he said.
“What they’re trying to do is make up the shortfall -- they’re relying typically on revenue increases in the form of tax hikes. Many provinces right across the country have followed this trend.”
The report notes that in 2014, the federal government and seven provincial governments across the country are planning deficits totalling $18.8 billion.
Lammam says Canadians spend almost half the year working to pay-off all the various taxes levied by the federal, provincial and local governments, including income taxes, property taxes, health, social security and employment taxes.
The report finds that in 2014, the average Canadian family of two paid $43,435 in total taxes, or 43.5 per cent of their annual combined income.
This year’s Tax Freedom Day falls one day later than the previous year, meaning that Canadians have been hit with a heavier tax burden.
Lammam says the delay is part of a growing trend across the country.
“If you look back over the last five years, there’s been a steady delay. So Canadian families are waiting longer and longer to keep the income they earn and more of their income is going to governments.”
The latest recorded Tax Freedom Day fell on June 14, 2000.
The institute also calculates tax-freedom day provincially. Here are the calculations for each province:
Alberta -- May 23
New Brunswick – June 9
Ontario -- June 7
Prince Edward Island -- June 5
Manitoba -- June 10
British Columbia -- June 6
Nova Scotia -- June 14
Quebec -- June 14
Newfoundland and Labrador -- June 22
Saskatchewan -- June 7