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January 25, 2024

Benjamin Franklin famously said, “in this world nothing can be said to be certain, except death and taxes.”  Canadians are amongst the highest paying taxpayers in the world.  Interestingly, the Fraser Institute keeps pushing tax Freedom Day back year over year in spite of the government creating new taxes year over year, calling into question the integrity of the Fraser Institute’s data.  In 2017 tax Freedom Day was on the 26th of June, now, according to the Fraser Institute, it has regressed to June 19th, without having any regard to the Carbon Tax and other taxes being added to the CRA’s portfolio.  It is entirely possible that they conflated corporate welfare (tax reductions and subsidies) with consumer tax data in arriving at their conclusion.

No matter how you look at it, Canadian consumers are paying so much in taxes they are left with ever decreasing amounts of money to pay for goods and services or to accumulate personal wealth.   Poverty in Canada, even in the face of the current regime lowering the accepted poverty line, has increased exponentially.  Homelessness has reached a level never before seen in this country, not even during the Great Depression.  People are camping out under bridges and viaducts, in parks, along rivers, parking lots and down alleyways.  Ironically, churches, that don’t pay taxes, keep their doors shuttered on the coldest of winter days, to prevent the “undesirables” entering their sacred spaces – in choosing a church one might ask “what Jesus have done?

An increasing number of pensioners and social assistance recipients are living on incomes that are less than half of the Government’s own Low Income Cut Off (“LICO”).  Some had worked for companies that squandered pension plans, yet, these folks are exposed to all the same taxes as the rest of us – including 13% HST on all (with very few exceptions) goods and services.  The corrosive economic impact of the so called carbon tax can be felt on everything that is manufactured, grown, shipped, and picked up.

Another big problem with taxes in Canada is their circularity, we pay HST, Carbon tax, income tax, etc., yet get refunds for overpayments on each of them – calling into question why they were paid in the first place.  Would it be too cynical to suggest tax creation is a part of a deliberately ever expanding government bureaucracy that ensures votes for the ruling party?  Some Canadians qualify for “non-refundable” tax credits, which are also designed to add to the size of the bureaucracy.  Canada’s bureaucracy is of comparable size to that of the old Soviet Union.  As a result of our cumbersome and unwieldy tax regulations a whole industry, consisting of hundreds of thousands of specialists, has sprung up.

While property taxes are the most obvious form of taxation that impact Canada’s housing crisis, almost every other tax has a role to play as well.  The government has recently introduced new taxes that are supposed to help cool off runaway prices.  We now have an underused housing tax, and we have capital gains taxes for people who have operated home based businesses amongst a plethora of other taxes.  Taxes diminish the incomes of the so called middleclass while providing handouts to crony capitalists. 

The absurdity of corporate handouts cannot be overstated, and they are extremely costly to ordinary taxpayers.  For example, some items that have been in the news include, $12 million to Loblaws to install fridges, $5 million to build a cellphone tower for telephone companies that charge Canadians the highest cellular prices in the world, $30 billion for a foreign car manufacturer to build an environmentally hazardous battery plant.  Consider each case.  Is Loblaws loosing money selling food?  Can Loblaws not afford its own business equipment?  Why are taxpayers funding cellular companies that in turn charge exorbitant user fees?  How about VW, could it not afford to build a plant to produce batteries?  Perhaps it’s in the wrong business, in the wrong part of the world?

Many taxes started life as emergency measures, and some were supposed to be rescinded – including income tax and GST.  In Canada we also pay tax on tax, for instance HST is paid “before” any other tax.  With an estimated 25% of the Canadian workforce working for some level of government the remaining 75% must fuel the massive bureaucracy.  China found success through embracing pure capitalism – instead of taxing corporations the government took ownership and profited through the success of the business.  China set up Free Trade Zones that eliminated taxes, reduced regulations, and encouraged business development – making China’s the fastest growing economy in the world.