What comes as a surprise to nobody — except Ottawa — is that Canada's middle class has seen inflation decimate their standard of living, especially young families. According to Statistics Canada, most workers have seen their purchasing power decline in recent years.
"Wages and earnings have not kept pace with price pressures, especially those related to food and shelter," said a StatsCan report Research To Insights: Consumer Price Inflation, Recent Trends And Analysis.
"Most workers have seen their purchasing power decline as inflationary pressures ramp up," it added.
Though weekly earnings typically increased 4.2% last year, rent also went up 5.9% over the same period.
"Despite moderate increases in wages and earnings, most workers have seen their purchasing power decline as inflationary pressures ramp up," wrote analysts.
According to Blacklock's Reporter, the cost of running a family car rose 13.4%, food prices increased 14.8%, and mortgage interest costs jumped 18%.
"Increases in the cost of living are [harming] net saving and wealth, especially for more vulnerable households. Low and middle-income households have seen large reductions in net savings while younger households have become more leveraged," reads the report.
"High inflation, especially for food products, has [severely strained] living costs, especially among more vulnerable households as income and saving levels adjust to the withdrawal in pandemic-related supports."
Per the Fraser Institute, 74% of Canadians believe the average family of two or more people is over-taxed by federal, provincial, and local governments.
"There is a large discrepancy between what the average family pays in total taxes versus what Canadians believe the average family should be paying," said Jake Fuss, associate director of fiscal studies at Fraser and author of Polling Canadians on Taxes for the Average Family.
Based on a Leger poll in early 2023 on the tax burdens imposed on families, the study finds that over half (52%) of Canadians believe the average family should pay 25% or less of their income to the local, provincial, and federal government.
StatsCan added that young adults expressed the most concern over finances, with almost half of those aged 35 to 44 having difficulty meeting their financial needs over the past year.
The Financial Consumer Agency found that 38% of Canadians borrow money to meet monthly expenses, said Blacklock's Reporter.
"In the current economic context, many Canadians are facing the biggest financial challenges of their lives," said an Agency report, Consumer Vulnerability: Evidence From The Monthly Covid-19 Financial Well-Being Survey. "More are borrowing money to cover their day-to-day expenses, including high-cost loans."
"The percentage of Canadians who borrowed money to cover daily expenses increased from 26% in 2020 to 38% in September 2022," said Consumer Vulnerability. Other findings from monthly questionnaires showed 48% of Canadians used their savings to meet monthly expenses, while 25% routinely spent more than they earned each month.
The average Canadian family paid 45.2% of its income to the federal, provincial, and local governments in 2022. According to the Leger poll, 80% of Canadians support the average family paying 40% or less of their income in total taxes to all levels of government.
Nearly half (44%) of the Canadians surveyed believe they're getting poor or very poor value from the services they receive from governments.
Forty percent of Canadians surveyed said they were "just getting by financially," while 41% worried they had no money to cover unexpected expenses like car repairs.
"It's clear that many Canadian families don't believe they're getting value from their taxes," said Fuss.
"Tax relief should be a much higher policy priority given the overwhelming view that average Canadian families are overtaxed coupled with the weak support for the value Canadians receive in government-provided services."
The Canadian Taxpayers Federation (CTF) released its annual New Year’s Tax Changes report in December to highlight the significant tax changes in 2023.
“Tax hikes will give Canadians a hangover in the new year,” said Franco Terrazzano, Federal Director of the CTF. “Canadians can’t afford gas or groceries, and the government is making things worse by hiking taxes.”
The report outlines the significant federal and provincial tax changes slated for this year, including higher CPP and EI premiums by hundreds of dollars, $445 more in carbon taxes — a second carbon tax — and a 6.3% tax increase on booze.