Graphic from FraserInstitute.org |
The mayor noted at last weekend's E-Town Hall meeting that an equal number of participants seemed to be calling for more expenditures as were calling for cuts to spending. He did not express surprise.
Indeed, my colleagues on council and I often find ourselves performing a balancing act, trying to figure out how much we can control spending before the "we want more services" public gets restless, and/or trying to determine how many new services we can provide before the "we want lower taxes" sector makes its concerns known.
Often when these issues arise, I find myself going back to the basic issue of affordability; that is, whether a cash-strapped, mortgaged family really can afford what is being proposed. I keep reminding my colleagues and the public that the government does not necessarily have to play such a large role in everyone's life.
This is why I have decided to share with you recent news from the Fraser Institute--news about the large percentage of people's income that goes to government. It's important stuff, and I would urge readers to click here to visit the FI site to access to the full report.
Here's the summary, as recently released by the FI (the bold-faced emphasis, below, is mine):
The Canadian Consumer Tax Index 2013
The Canadian tax system is complex and no single number can give us a complete idea of who pays how much tax. This Alert examines what has happened to the tax bill of the average Canadian family over the past 51 years. To do this, we have constructed an index of the tax bill, the Canadian Consumer Tax Index, for the period 1961 to 2012.The Canadian Consumer Tax Index reveals that there has been a dramatic increase in the average family’s tax bill from 1961 to 2012. Among those factors is a sizeable increase in incomes over the period: 1,382 percent since 1961. Even with no changes in tax rates, the family’s tax bill would have increased substantially; growth in family income alone would have produced an increase in the tax bill from $1,675 in 1961 to $24,828 in 2012. Second, the average family faced a tax rate increase from 33.5 percent in 1961 to 42.7 percent in 2012. It is clear that taxes have become the most significant item in family budgets, and that taxes have grown more rapidly than any other single item.
In 1961, the average family spent 56.5 percent of its cash income to pay for shelter, food, and clothing. In the same year, 33.5 percent of the family’s income went to governments as tax. By 2012, the situation was reversed: the average family spent 36.9 percent of its income on the necessities of life while 42.7 percent of its income went to taxes.
The results show that the tax burden faced by the average Canadian family has risen compared with 51 years earlier. The total tax bill, which includes all types of taxes, has increased by 1,787 percent since 1961, and the tax bill has grown more rapidly than any other single expenditure item.