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Kim G C Moody’s Musings – 1-1-1 Newsletter For September 13, 2023

One Comment About Taxation – How Much in Taxes Does the Average Canadian Family Pay Compared to the Necessities of Life?

The Fraser Institute released its 2023 edition of its publication Taxes versus the Necessities of Life: The Canadian Consumer Tax Index (the “Report”), which tracks the total tax bill of the average Canadian family from 1961 to 2022. It’s a fascinating read to see how much the average Canadian pays in taxes – not just income tax, but other taxes like property taxes, GST, carbon taxes, etc.

Some highlights from the publication:

  • “Including all types of taxes, [the tax] bill has increased by 2,778% since 1961.”
  • “Taxes have grown much more rapidly than any other single expenditure for the average Canadian family: expenditures on shelter increased by 1,880%, food by 870%, and clothing by 654% from 1961 to 2022.”
  • “The average Canadian family now spends more of its income on taxes (45.3%) than it does on basic necessities such as food, shelter, and clothing combined (35.6%). By comparison, 33.5% of the average family’s income went to pay taxes in 1961 while 56.5% went to basic necessities.”
  • “In 2022, the average Canadian family earned an income of $106,430 and paid total taxes equaling $48,199 (45.3%).”
  • “In 1961, the average family had an income of $5,000 and paid a total tax bill of $1,675 (33.5%).”

The fact that the average Canadian family now pays – and has for a while – more in taxes than necessities of life is mind-boggling.  The Report reveals that the gap narrowed from about 2005-2010 and again from about 2018-2020 but significantly spiked in recent years.

In my view, policy makers need to pay close attention to studies and tracking like that of the recent Report.  It’s time to return to the 1960s to 1980s, where, rightfully, Canadians spent more on the necessities of life than to support bloated governments.

 One Comment About Leadership – An Important Role of a Leader is to Bring Hope

Over this past weekend, I listened to Pierre Poilievre’s speech at the Conservative Party Convention in Quebec City, QC.  Towards the end of his speech, he stated the following:

You know, the most important job of any leader is to bring hope.  Hope is what Canadians need now more than ever.  Hope is something that you feel. But it’s hard to picture it. So let me paint a picture for you.  Of students laughing and walking down safe streets to class. The distant drumming of hammers driving nails through Canadian lumber and to yet another beautiful new Canadian home. Shopkeepers sweeping clean storefronts at the end of another day waving to seniors heading home with a car full of groceries and change in their pockets as daylight fades to night. Kids are heard pleading for “TEN MORE MINUTES!!” of street hockey before bed.  And then, quiet.  And a young couple sits on their porch soaking in the summer warmth; a Canadian flag hanging gently but proudly from the front of their house. With a cold drink in one hand and a paycheque in the other, they look into each other’s eyes in a way that can only say “the hard work paid off”.  The sacrifices were worth it because finally we are home.

I’m a big Pierre Poilievre fan and have not been shy about stating that in other forums.  I’ve had the benefit of getting to know Pierre personally over the last number of years and he is as transparent as they come.  For example, when I released my book – Making Life Less Taxing – he was kind enough to appear to say a few words during one of my book readings. We often chat about tax and taxation policy.   He is genuinely interested in making Canada a better place.

Regardless of your political stripes, what is your thought on his opening sentence in the above portion of his speech when he said, “…the most important job of any leader is to bring hope”?

For me, I could quibble about whether bringing hope is the most important job, but I agree that it is important.  Nothing is worse than a leader who constantly trumpets fear and promotes “the sky is falling!” messages or promotes a divisive “us vs them” message.  Instead, if a leader promotes realistic hope – through engaging storytelling – that leader displays a remarkable degree of empathy for the human psyche.

Human beings want hope and to know that better days or situations are coming.  Leaders, be that inspirational leader and purposely bring hope to the people who follow and look up to you.


One Comment About Economics – Government Intervention into the Housing Market

I have written about the Canadian housing market challenges in a previous edition of this newsletter.  Housing challenges and an overall poor economy can provide poor polling results for politicians, and certainly the reigning Canadian government has experienced its fair share of such poor results recently.  The Prime Minister’s Office has been quick to try to quell such negativity with a summer cabinet shuffle and planting its fair share of media articles about how it intends to deal with housing challenges.  One such article appeared recently by the biased[1], bloated and government-funded CBC.  It suggests that the government is considering some of the following measures to “help ease the pain”:

  • Tax incentives for builders to build;
  • Low-cost financing arrangements for builders;
  • Encouraging factory-built homes;
  • Capping the number of international students coming to Canada;
  • Removing GST on “affordable housing”

While none of the above is earth shattering or particularly new ideas, certainly some of the above – and more – should be explored.  But, in my opinion, none of the above are single and solitary solutions.

This leads to an overall consideration:  is government intervention helpful, harmful or neutral in helping deal with housing shortages?  Lots of ink has been spilled on this topic.  I think that the federal government certainly has a role to make the overall environment more friendly – like a well-thought-out immigration policy – but direct intervention usually causes more harm than good.

What are your thoughts?

Bonus Comment – Quote From Napoleon Bonaparte, French Military and Political Leader

A leader is a dealer in hope.”

Yep…totally agree!

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[1] In the article, media bias appears with recent government statements that have been fuelled by the CBC as follows: “Housing is primarily a provincial and municipal responsibility, though the federal government does play a role through the Canada Mortgage and Housing Corporation and its own housing strategy.” 

 This statement is a shallow exaggeration.  Housing is a complex, multi-faceted issue that goes beyond simple politics like the above statement.  For example, housing is greatly impacted by immigration policies which is a federal initiative.  It is also greatly impacted by the overall economy, interest rate environment and taxation policy which certainly the Federal government plays a part in.