Canadian families now spend a larger share of income on taxes than on essentials

According to the Fraser Institute's latest Canadian Consumer Tax Index, the typical household now devotes 41.9% of its income to taxes, outpacing the 36% spent on food, shelter and clothing combined. Historical data back to 1961 show taxes once comprised only a third of earnings, with necessities making up more than half, but the trend reversed around 1980 and has widened since the early 1990s. Income taxes (31.7%) and payroll/health levies (22.3%) together form the bulk of the tax load, followed by profit, sales and property taxes.

Last year the average family earned $121,111 and paid $50,721 in taxes, a rise of 2,928% in nominal terms since 1961. Only three intervals saw tax shares fall, the latest during the pandemic when wages rose modestly while tax receipts dropped. Even after adjusting for inflation, the tax bill more than doubled in constant 2025 dollars.