Kim Moody: A few of these costs are apparent, however many are buried within the high quality print of day by day life, quietly draining wallets
Opinions and proposals are unbiased and merchandise are independently chosen. Postmedia could earn an affiliate fee from purchases made via hyperlinks on this web page.
Article content material
Folks routinely assume you imply revenue tax if you speak to them about paying taxes, however have you ever ever considered all the opposite forms of taxes and authorities charges and levies that erode your revenue and wealth?
Article content material
Article content material
Technically, taxes are necessary, with no direct profit to such funds. Charges charged by governments are normally in change for some kind of service or different profit. A levy is commonly imposed on an trade or exercise, however can embody a broad class of prices. In actual life, the excellence between charges and levies may be very blurry.
Commercial 2
Article content material
Right here’s a fast record of among the extra apparent tax and costs and levies that Canadian households pays in a 12 months:
1. Federal and provincial revenue taxes: The charges fluctuate by taxable revenue and province of residence for people, however vary from a low of zero to a excessive of roughly 54 per cent. These taxes embrace taxes on employment, capital positive aspects, property revenue, enterprise revenue, and many others.
2. Canada Pension Plan, Québec Pension Plan and Employment Insurance coverage: These are a type of a payroll tax since contributions by the taxpayer are necessary.
3. GST/HST: There are some exceptions to Canada’s value-added consumption tax, however it could vary from a low of 5 per cent (in Alberta, Nunavut, Yukon and the Northwest Territories) to a excessive of 15 per cent in most Atlantic provinces.
4. Provincial gross sales tax (PST): British Columbia, Manitoba, Quebec and Saskatchewan additionally cost a separate provincial gross sales tax since they don’t seem to be harmonized with the GST. This provides apparent confusion in these provinces as to what’s taxable for PST functions versus GST functions.
5. Federal and provincial excise taxes on gasoline and different fuels with extra carbon taxes.
High Tales
Article content material
Commercial 3
Article content material
6. Federal and provincial excise taxes on alcohol.
7. Federal customs duties and tariffs on sure imported items.
8. Federal luxurious taxes on sure cars, airplanes and boats.
9. Air travellers safety cost: That is levied on a per-passenger foundation relying on the kind of flight.
10. Provincial automobile registration and driver’s licence charges: All provinces cost a charge to register automobiles and have a driver’s licence.
11. Municipal property taxes: Every municipality in Canada costs you a stunning tax for the pleasure of proudly owning actual property in its jurisdiction.
12. Property switch tax: Some provinces, resembling B.C. and Ontario, cost land switch taxes every time a property’s title is transferred.
13. Life insurance coverage premium tax: If you happen to personal a life insurance coverage coverage in Canada, nicely, you’re not directly paying a provincial premium tax that the life insurance coverage carriers pay.
14. Improvement costs: Typically paid by land builders to municipalities to fund numerous infrastructure (colleges, roads, and many others.) which are handed on to the purchasers of the property.
Commercial 4
Article content material
15. Municipal landfill charges: If you wish to dump your rubbish off, there’s usually a price for that.
16. Municipal parking charges and fines: If you wish to park in a metropolis, there’s a price for that.
17. Toll roads and bridges: some provinces, resembling Ontario, cost charges to entry sure roads and bridges.
18. Quick-term rental charges: Some municipalities cost registration charges for the pleasure of renting out your property. Such prices are handed alongside to renters.
19. Enterprise licensing charges: Many municipalities cost a charge for beginning or working a enterprise.
20. Constructing allow charges: There’s normally a municipal allow requirement with a charge for constructing or renovating your own home.
21. Emergency companies charges: There’s a value to be paid in the event you want an ambulance.
22. Emptiness taxes: Some municipalities, resembling Toronto and Vancouver, have emptiness taxes that may apply to residents if their property is sitting vacant too lengthy.
23. Passport charges: There’s a charge to acquire a passport.
24. Firearm charges: There’s a charge to acquire a gun.
25. Ontario well being premium: The province costs a most of $900 per 12 months, relying in your taxable revenue. Alberta and B.C. beforehand had well being premiums, however abolished them.
Commercial 5
Article content material
I might go on and on. Hopefully, you see the image that taxes, charges and levies carry an enormous value for households.
The Fraser Institute’s eye-popping annual survey of the tax load for a mean Canadian household of 4 (married couple with two younger youngsters) stated the taxation load in 2023 was 43 per cent of the household’s money revenue. This proportion doesn’t embrace among the charges and levies listed above, and it’s additionally considerably larger than the prices for meals, clothes and shelter mixed.
It’s fairly clear our governments discover methods to tax, charge and levy Canadians and have an insatiable urge for food to do extra of it. A few of these costs are apparent, however many are buried within the high quality print of day by day life, quietly draining wallets.
That the typical household’s tax burden exceeds their mixed fundamental residing prices must be a wake-up name to take a tough have a look at what you’re paying and ask whether or not you’re getting good worth in return.
Really helpful from Editorial
The reply is an emphatic no. We must be anticipating extra for our hard-earned contributions and that begins with demanding balanced budgets (not enjoying accounting video games to get to balanced budgets or decreased deficits resembling Mark Carney is proposing to do) and respect for taxpayer {dollars} from our flesh pressers.
Commercial 6
Article content material
“One of the simplest ways to show your children about taxes is by consuming 30 per cent of their ice cream,” the well-known actor Invoice Murray as soon as stated. Besides in Canada, the ice cream-eating proportion is excess of 43 per cent. I’m assured your children received’t really feel like they obtained good worth in return for you consuming that 43 per cent.
Kim Moody, FCPA, FCA, TEP, is the founding father of Moodys Tax/Moodys Non-public Shopper, a former chair of the Canadian Tax Basis, former chair of the Society of Property Practitioners (Canada) and has held many different management positions within the Canadian tax neighborhood. He may be reached at kgcm@kimgcmoody.com and his LinkedIn profile is https://www.linkedin.com/in/kimgcmoody.
_____________________________________________________________
If you happen to like this story, join the FP Investor Publication.
_____________________________________________________________
Bookmark our web site and help our journalism: Don’t miss the enterprise information you could know — add financialpost.com to your bookmarks and join our newsletters right here.
Article content material
