Taxes versus the Necessities of Life: The Canadian Consumer Tax Index 2014

The Canadian Consumer Tax Index tracks the total tax bill of the average Canadian family from 1961 to 2013. Including all types of taxes, that bill has increased by 1,832 percent since 1961. Taxes have grown much more rapidly than any other single expenditure for the average Canadian family: expenditures on shelter increased by 1,375 percent, clothing by 620 percent, and food by 546 percent from 1961 to 2013.

The 1,832 percent increase in the tax bill has also greatly outpaced the increase in the Consumer Price Index (682 percent), which measures the average price that consumers pay for food, shelter, clothing, transportation, health and personal care, education, and other items. In fact, the average Canadian family now spends more of its income on taxes than it does on basic necessities such as food, shelter, and clothing. In 2013, 41.8 percent of the average family’s income went to pay taxes while in 1961, only 33.5 percent of the family’s income went to taxes.

In 1961, the average family had an income of $5,000 and paid a total tax bill of $1,675 (33.5 percent). In 2013, the average Canadian family earned an income of $77,381 and paid total taxes equalling $32,369 (41.8 percent).

The federal and most provincial governments are running budget deficits, meaning that current taxes do not cover current spending. Including deferred taxes (deficits) means the tax bill of the average Canadian family has increased by 1,975 percent since 1961.