Title: Canadia Members of Parliament Receive Pay Hike on the Same Day as Carbon Tax Increase
Canadian Members of Parliament (MPs) are set to receive a pay raise on April 1st, coinciding with the government’s plan to increase the Carbon Tax. A petition has been launched calling on Deputy Prime Minister and Finance Minister Chrystia Freeland to Stop The Pay Hike, gaining 7,681 signatures so far, with a goal of reaching 10,000 signatures.
A new study conducted by the Fraser Institute challenges the belief that higher-income Canadians do not pay their fair share in taxes. According to the institute’s report titled “Measuring Progressivity in Canada’s Tax System,” the top quintile, accounting for the highest 20% of household incomes over $243,799 per year, contributes 61.9% of all personal income taxes in the country and 53.1% of total taxes. In contrast, the bottom quintile, earning up to $59,270 annually, only pays 0.7% of federal and provincial personal income taxes and 2.0% of total taxes.
The study reveals that the first quintile’s share of total income is over seven times larger than their share of income taxes paid. These findings contradict the belief that high-income earners do not contribute enough in taxes. The institute attributes Canada’s ‘progressive’ tax system to the fact that households pay more taxes as their income rises. However, they argue that the policy of raising taxes on the top quintile based on claims of unfair tax contributions is founded on “false reasoning.”
Jake Fuss, associate director of fiscal policy studies at the Fraser Institute, emphasizes that increasing taxes may not necessarily result in additional revenue. He also warns that such tax hikes could negatively impact Canada’s competitiveness with other industrialized nations, particularly the United States, in attracting highly skilled professionals.
The Canadian Taxpayers Federation (CTF) echoes these concerns, suggesting that the government should focus on reducing wasteful spending before resorting to tax increases. The CTF’s “New Year’s Tax Changes” report highlights several tax increases experienced by Canadians, including higher Canada Pension Plan (CPP) and Employment Insurance (EI) premiums, an additional carbon tax of $445, and a 6.3% increase in alcohol tax.
A Leger poll conducted earlier this year indicates that over half of Canadians (52%) believe the average family should pay no more than 25% of their income in taxes. Additionally, four out of five Canadians support paying the government less than 40% of their income. Many view higher taxes as discouraging for individuals and businesses, potentially leading to capital flight and a negative impact on investment.
As of June 19th, Canadians have worked for more than five months solely to cover their tax obligations, representing a delay in “Tax Freedom Day” compared to 2019 and 2021. This year, Tax Freedom Day falls on June 19th, marking the point where Canadians start working for themselves, rather than for the government.
The public sentiment against the MP pay increase, coinciding with the carbon tax and alcohol tax hikes, is strong. Over four out of five Canadians oppose the pay raise and are urging Finance Minister Chrystia Freeland to take action. The petition aims to halt these increases and ensure that taxpayers’ concerns are listened to and addressed.
In conclusion, the petition aims to draw attention to the disparity in tax contributions among income groups and seeks to stop the scheduled pay increase for Canadian MPs. The study supports the notion that higher-income earners already contribute a significant portion of taxes and challenges the belief that they are not paying their fair share. The Canadian Taxpayers Federation also emphasizes the need for prudent spending rather than tax increases. With public support against these increases, it is crucial for the government to consider the economic implications and the concerns of the Canadian taxpayers.