New report finds taxes consume more income than food, housing, clothing combined
Hardworking Canadians might expect that most of their money would be spent on the necessities of everyday living, but the reality is that the lion’s share of their income is paid out in tax.
That’s according to a new Fraser Institute study revealing that taxes remain the single largest household expense for Canadian families, surpassing even food, housing, and clothing combined.
According to the Canadian Consumer Tax Index 2025, the average Canadian family earned $114,289 in 2024 and paid $49,844 in total taxes or 42.3% of their income, compared to 35.5% on housing, food and clothing combined.
“At a time when the cost of living is top of mind across the country, taxes remain the largest household expense for Canadian families,” said Jake Fuss, director of fiscal studies at the Fraser Institute and co-author of the report.
Since 1961, when the average family paid just 33.5% of its income in taxes and 56.5% on basic necessities (from an income of $5,000) the report finds that the total tax bill has ballooned by 2,784%, while the cost of food, clothing, and shelter combined has risen by 927%, 460%, and 2,129% respectively.
The Fraser Institute’s index tracks all taxes paid at all levels of government including income taxes, payroll deductions, sales taxes, property taxes, carbon taxes, and more. It provides a more comprehensive look at what Canadians actually pay, far beyond the income tax often focused on in public debate.
These trends appear deeply entrenched and despite recent tax relief measures at various levels of government, the total tax burden remains near historical highs.
“While Canadians can decide for themselves whether or not they get good value for their tax dollars, they should understand how much they pay in taxes each year,” Fuss said.
