More than seven in 10 Canadians believe the cost of individual taxes is too high – and taxing companies more isn't the answer
As recession fears hang thick and inflation burning at a level not seen in 30 years, new research from the Montreal Economic Institute (MEI) offers a glimpse into how taxes could be aggravating cost of living issues for Canadian families.
More than seven in ten Canadians (72%) believe the individual tax burden is too high, compared to one in five (21%) who believe it is at an acceptable level, according to an Ipsos poll conducted on behalf of the MEI.
"The results of this poll reflect the weight of the tax burden on families," explained Olivier Rancourt, Economist at the MEI. "In these times of economic uncertainty, few of them have the room to manoeuvre needed to build up an emergency fund or any kind of cushion for themselves. Don't forget that taxes are households' number one expense, and by a long shot."
Read more: Canadians' tax burden has outpaced other single expenditures
The poll found that 42% of families believe that businesses pay too little in taxes. Nevertheless, 71% of Canadians are aware that raising the tax burden on businesses will ultimately hurt consumers by raising prices.
Krystle Wittevrongel, Senior Policy Analyst and Alberta Project Lead at the MEI, said, “People expect governments to do their part to lighten their tax burden. They already feel they're overtaxed, and they suspect that trying to squeeze more out of companies will just end up penalizing them indirectly."
Of the poll participants who think the tax rate for income over $250,000 should be higher than 50%, the majority feel it should be 55%. Almost three tenths (28%) think it should be 65%.
Nearly two thirds (64%) of Canadians in the poll think fiscal laws are overly complicated, and more than three quarters (77%) feel that wealthy people will be enticed to leave or transfer their assets to more desirable nations if their taxes rise too high.
Read more: Four reasons behind Canada's tangled tax laws
Four out of 10 Canadians (41%) think that raising taxes on the "rich" and "very rich" would be beneficial. When asked how much they believe a person should earn annually to be considered “rich,” 40% of respondents altogether said it should be more than $250,000, 23% said more than $500,000, and 14% think it should be more than $1 million.
A quarter (24%) of Canadians think the "very rich" invest in businesses and generate jobs, compared to more than half (55%) who think they use their money to purchase luxury products and services.
There is disagreement among Canadians over the tax rate for income over $250,000. A total of 44% agreed that group should shoulder a tax rate of more than 50%, while 42% disagree with the notion.
Ipsos performed the online survey between September 27 and October 1 of 2022 on behalf of the MEI, using a sample of 1,027 Canadian citizens who were at least 18 years old.
