It's 'tax freedom day': now start working for yourself
Fraser Institute says June 7 is the day, but it varies, depending on where you live
Canadians feeling taxed to the max can at least take comfort in this being tax freedom day.
The Fraser Institute picked June 7 this year as the day the average Canadian family has worked long enough to pay its total tax bill.
It's a hypothetical day, meaning if you had to pay all your taxes up front to different levels of government, you would now be in the clear to keep the rest of your earnings until a new year begins.
In 2016, the average Canadian family (with two or more people) earning $105,236, will pay $45,167 in total taxes. That's 42.9 per cent of its annual income.
On the calendar, those numbers represent more than five months of income — from Jan. 1 to June 6. Therefore, it's only on June 7 when families start working for themselves, not the government.
The Vancouver-based think-tank calculates the tax burden to include income taxes, payroll taxes, taxes on health and property, as well as what is levied on sales and fuel.
Earlier than 2015
While tax freedom day comes two days earlier than in 2015, "it's not because of any major tax reductions," the institute says. It notes that 2016 is a leap year, which helped the day arrive sooner.
And because the day is calculated based on federal and provincial tax revenue forecasts, overly conservative revenue estimates by governments moved the date earlier up the calendar.
When governments provide actual revenue estimates at the end of the year, tax freedom day calculations are revised.
Before all Canadians mark the day, however, the Fraser Institute says they need to remember there are different tax freedom days, depending on where you live.
Albertans would have seen their tax burden lifted by May 17, while taxpayers in Newfoundland and Labrador won't have their day of tax freedom until June 14.
Provincial tax freedom days (earliest to latest)
|Prince Edward Island||June 1|
|British Columbia||June 5|
|Nova Scotia||June 9|
|New Brunswick||June 11|
|Newfoundland and Labrador||June 14|
More than three decades ago, in 1981, tax freedom day fell on May 30. In 2000, it was June 25.
In the U.K., June 3 was declared tax freedom day by the Adam Smith Society, a group of economists and business school leaders and other academics.
"We work longer for the government than medieval serfs had to work for their lords," the society said.