From the Fraser Institute

By Jason Clemens and Jake Fuss

One of the authors of this op-ed resides in a municipality, which recently launched an online survey to gauge the preferences of residents with respect to its upcoming budget, which is laudable, but the questions illustrate a problem within government: a bias for more government.

The City of Coquitlam in British Columbia asked respondents whether it should increase, decrease or simply maintain the same level of spending in 2025 for policing, recreation, water and sewage, infrastructure and others items. The problem: there wasn’t a single question on whether residents prefer tax reductions.

Moreover, there was no discussion or context about how increased spending for these activities must come from taxpayers in the form of either having more taxpayers (city population increases) and/or higher tax rates for those residing in the city. What’s clear from the survey is that the municipal government prefers to spend more.

And this bias towards more government within government is not restricted to this local municipality. Other municipalities, provincial governments and certainly the Trudeau federal government have favoured more spending.

Under Prime Minister Trudeau federal spending has reached never-before-seen levels, even after adjusting for inflation. Consider, for instance, that per-person federal spending (excluding interest costs) will reach $11,901 this fiscal year (inflation-adjusted), well above previous levels of per-person spending including during the 2008-09 financial crisis and both world wars. The rationale is that Ottawa is delivering services demanded by Canadians.

But is that true? Are Canadians demanding national pharmacare, national dental benefits and a national daycare program? The answer depends on whether the costs of those programs are included in the discussion.

A 2022 poll asked Canadians about their support for all three programs. Support ranged from 69 per cent for national daycare, to 72 per cent for dental care, to 79 per cent for pharmacare. Here’s the problem, though. The questions were asked without respondents considering any costs. In other words, the respondents were asked whether they support these programs assuming they don’t affect their taxes.

But of course, taxpayers must pay for government spending, and when those costs are included, Canadians are much less supportive. In the same poll, when increased spending is linked with an increase in the GST, support plummets to 36 per cent for daycare, 40 per cent for pharmacare and 42 per cent for dental care.

And these results are not unique. A 2020 poll by the Angus Reid Institute found 86 per cent support for a national prescription drug program—but that support drops by almost half (47 per cent) if a one-percentage point increase in the middle-class personal income tax rate is included.

One explanation for the dramatic change in support rests in another poll, which found that 74 per cent of respondents felt the average Canadian family was overtaxed.

So it’s convenient for governments to avoid connecting more spending with higher taxes.

This internal government support for more government also shows up in our tax mix. Canadian governments rely on less visible taxes than our counterparts in the OECD, a group of high-income, developed countries. For instance, Canadian governments collect 6.8 per cent of the economy (GDP) in consumption taxes such as the GST, which are quite visible and transparent because the cost shows up directly on your bill. That ranks Canada 31st of 38 OECD countries and well below the OECD average of 10.0 per cent.

Alternatively, we rely on personal income tax revenues to a much greater degree and, because these taxes are automatically deducted from the paycheques of Canadians, they are much less apparent to workers. Canada collects 12.3 per cent of the economy in personal income taxes, ranking us 6th highest for our reliance on personal income taxes and above the OECD average of 8.3 per cent.

And a complying media aids the push for more government spending. According to a recent study, when reporting on the announcement of three new federal programs (pharmacare, dental care and national daycare) the CBC and CTV only included the cost of these programs in 4 per cent of their television news coverage. Most of the coverage related to the nature of the new programs, their potential impact on Canadians, and the responses from the Conservative, NDP and Bloc Quebecois. Simply put, the main television coverage didn’t query the government on the cost of these new programs and how taxpayers would pay the bill, leaving many viewers with the mistaken impression that the programs are costless.

Indeed, it’s interesting to note that the same study found that 99.4 per cent of press releases issued by the federal government related to these three programs excluded any information on their costs or impact on the budget.

The inherent bias within government for more government is increasingly clear, and supported by a lack of skepticism in the media. Canadians need clearer information from government on the potential benefits and costs of new or expanded spending, and the media must do a better job of critically covering government initiatives. Only then can we realistically understand what Canadians actually demand from government.

Jason Clemens

Executive Vice President, Fraser Institute

Jake Fuss

Director, Fiscal Studies, Fraser Institute

From the Canadian Taxpayers Federation

Prime Minister Justin Trudeau’s carbon tax should be tucked under his arm while he doesn’t let the door hit them on the way out.

And Liberal caucus members need to make sure that happens.

Those in doubt need to ask themselves two questions.

Practically, why should Canadians keep paying the carbon tax for another few months before the next election?

Politically, why should government MPs keep paying a price with voters because of the carbon tax?

The carbon tax can be slayed on Wednesday during the Liberal party’s emergency caucus meeting.

Caucus finally rose up and finally forced the prime minister to face the reality that he can’t get re-elected.

But that’s only half of the job.

The problem isn’t just one person. It’s the policies. And Trudeau’s trademark carbon tax is one of his biggest failures. Replacing the PM while keeping the carbon tax is like switching the blackjack dealer while still facing a stacked deck.

And the Liberal caucus knows this.

Those Liberal MPs have been yelled at by their constituents about the carbon tax for years.

Hardworking people have been telling these MPs they can’t afford the carbon tax and it’s unfair to be punished for driving to work, heating their homes and buying food.

Those MPs have seen their constituents’ heating bills, the costs of their commutes and the invoices for their businesses.

They know the carbon tax adds about $13 to the cost of filling a minivan and about $20 extra to fill a pickup. They know the carbon tax is costing long haul truckers about $2 billion this year and they know it will cost farmers $1 billion in the next five years.

They know Canada misses its emissions targets, even with the carbon tax.

And here’s the big one: these MPs know the carbon tax is getting hiked on April 1.

The timeline has to be terrifying for Liberals seeking re-election.

March 24, the House of Commons reconvenes.

The government presents its Throne speech and immediately starts facing confidence votes with all opposition parties promising to vote against the government.

Then, on April 1, the government raises the carbon tax again.

Imagine door knocking after losing a confidence vote and raising the carbon tax.

Imagine being an MP from southern Ontario and a greenhouse tomato grower walks into your office with a chart showing his carbon tax costs.

Imagine trying to tell that farmer that he “gets more back” than he pays in the carbon tax.

Picture being an MP from Halifax and telling your constituents they need to buy an electric heat pump as their sole source of winter warmth before the carbon tax slaps them again.

Nova Scotia has charming weather events such as ice fog which seeps into a house like a ghost from a Dickens novel. So, most Maritime folks still need a furnace and Trudeau’s carbon tax punishes them.

These MPs have all been hollered at by their constituents who have been wounded by the carbon tax.

No matter how much the MPs may have pleaded with Trudeau behind closed doors, he kept the carbon tax and forced his MPs to defend it.

Trudeau tied this millstone to the necks of his MPs and didn’t care how much it ground them down.

But he’s leaving now.

And these Liberal MPs have the opportunity to cut the rope and free themselves from Trudeau’s carbon tax.

The Liberal caucus is holding an emergency meeting on Parliament Hill on Wednesday, and those members of Parliament need to demand an end to carbon tax then and there.

Why should they force Canadians to keep muttering profanities when they fill up their cars or pay the carbon tax charges on their heating bills?

Why should Liberal MPs face day after day of berating phone calls from constituents who don’t buy PMO talking points about the carbon tax?

The least they can do is spare Canadians the cost of the carbon tax right now and try to do the right thing in the end.

On Wednesday, Liberal MPs have to demand an end to the carbon tax.