Hands In Our Pockets
Updated: Nov 10, 2020
𝓗𝓪𝓷𝓭𝓼 𝓲𝓷 𝓸𝓾𝓻 𝓟𝓸𝓬𝓴𝓮𝓽𝓼
To all my social media friends: As Ronnie Hawkins would say “You Rock!” Your response to my “Axe The Tax?” commentary has been overwhelming, and many of you are now asking, “So Linda, just how much tax do we pay?” Well, let’s dig a little deeper.
According to the Fraser Institute, this year the average Canadian family (two or more individuals) will earn $115,753. This income includes wages and salaries, self-employment income, interest, dividends, private and government pension payments, like CPP, old age pensions and other government transfers, like the Canada Child Benefit.
Now ready for this: Of that a whopping $43,681 will be paid to all three levels of government to keep the taxman happy. These taxes include income taxes, payroll taxes, health taxes, sales taxes, SIN taxes, property taxes, gas taxes, carbon taxes, import duties, and on and on. That’s 37.7% of our hard-earned cash going to pay the taxman. “Now Linda,” some of you may say, “the tax grab is down from a higher level a few years ago.” Well I say, don’t be fooled.
This COVID-19 pandemic, as the Fraser Institute points out, has skewed our economic landscape. For example, when the economy slows and incomes fall due to job losses, pay cuts, etc. – the average family’s tax burden falls, too, as many fall into a lower tax bracket. That pushed Tax Freedom Day in 2020 to May 19, down from June 8 in 2019. Tax Freedom Day, by the way, is the day we stop handing over our paycheques to the taxman, and get to keep our hard-earned money. That’s if we had to pay all our taxes upfront. Now, here’s what's scary: With the increased spending due to this pandemic and our annual deficit jumping to $343 billion, Tax Freedom Day would fall on July 26, if we were forced to balance the books. As I say, we live in the greatest country in the world and we all want to pay our fair share. But today’s debt is tomorrow's taxes, and Canadians households are already struggling.
Brace yourselves and try to be financially fit. I am Linda Leatherdale.