Social Policy in Ontario

There is no sweeter time of year for those perennially convinced of government’s greed and bloat than the release of the Fraser Institute’s annual Canadian Consumer Tax Index, which never lets the truth get in the way of a bit of anti-tax panic.

The numbers are again eye-popping. According to the authors, the tax bill of the average Canadian family has increased by a whopping 2,006 per cent since 1961. We now pay more in taxes than we do on housing, food and clothing combined, the report gasps, as it does every year.

As ever, however, the scandal the report purports to uncover would seem far less scandalous if only the numbers used were not so distorted and out of any context.

To take a few egregious examples: the report doesn’t account for inflation. It includes corporate taxes in the average family’s tax bill, though these are largely shouldered by richer Canadians. It presents the mean family as the typical one, though the median family, which earns less and thus pays less in taxes, would be more appropriate.

The report asserts that Canadians, on average, spend more than 40 per cent of their income on taxes. A recent study from the Broadbent Institute put the number at about half that. There are many ways to calculate these things; the Fraser Institute’s questionable methodology no doubt suits its dogmatic aversion to taxes and active government.

Nor does the report mention that Canada is increasingly a low-tax country compared to our peers. When it comes to taxes as a share of GDP, for instance, Canada is well below average among OECD nations. But saying that, we suppose, might dampen the outrage.

The study’s greatest failing, however – the omission that ultimately renders its statistics meaningless – is that it makes no mention whatsoever of what we get in return for our tax money. Nowhere does the report mention “public services” or “programs,” nowhere “roads” or “schools.” It’s true that taxes as a percentage of our income have risen over the last 56 years, by around 7 per cent, but consider what they have bought: medicare, for instance, and the Canada Pension Plan, to name just two programs established after their baseline year of 1961.

Not only are these and other aspects of our social safety net arguably central to our national identity – the civilization, you might say, for which taxes have been the price. But they have also yielded exceptional value for money.