A Fraser Institute study was released Tuesday, showing the share of Canadians’ income going towards governments at all levels has risen from 33.5 per cent in 1961 to 41.8 per cent in 2013.
It’s important to put the study into context.
The Fraser Institute is a think tank which believes in smaller government, and has steadfastly engaged in many studies over the years to debunk “big government.” Some of those studies have been quite useful, others not so much.
The institute also participates in the worldwide “Tax Freedom Day” event, which marks the day when people begin to work for themselves each year, as opposed to the taxman. This year, the date in Canada was June 9.
All that said, there is no question that some of the money paid in taxes is not well-spent. While abuses by politicians like Alison Redford or Mike Duffy get the headlines, there are many programs in government of limited or almost no use. One B.C. example is the carbon tax rebate to large corporations, paid by school districts and hospitals with tax dollars.
However, as the Canadian Centre for Policy Alternatives (the polar opposite to the Fraser Institute) notes, it’s very difficult to compare 1961 to 2014. Governments provide medicare now — there was little spending on health care in 1961. That’s where a lot of tax dollars go.
There are also many more government programs that redistribute funds to lower-income Canadians, including the GST credit and the carbon tax credit in B.C.
The Canada Pension Plan and Old Age Security also did not exist prior to 1961.
Governments certainly have room to cut. A focus on how much tax we pay as a percentage of income is useful, because taxpayers need to consider whether we get full value for the money we spend each year.
-The Langley Times