By Franco Terrazzano

The Canadian Taxpayers Federation estimates members of Parliament will take a 3.9 per cent pay raise on April 1.

“Instead of padding their pockets again this year, it’s time for MPs to stand up for taxpayers and demand an end to these pay raises,” said Franco Terrazzano, CTF Federal Director. “Canadians can’t afford one more dollar going to highly paid politicians and MPs don’t deserve another raise.”

A backbench MP’s salary is currently $203,100. A minister collects $299,900, while the prime minister takes home a $406,200 annual salary.

MPs give themselves pay raises each year on April 1, based on the average annual increase in union contracts with corporations that have 500 or more employees.

While final pay numbers have not been released, contract data published by the government of Canada shows the average annual increase in corporate union contracts totaled about 3.9 per cent in 2024. Using this data, the CTF estimates this year’s pay raise will amount to an extra $7,900 for backbench MPs, $11,600 for ministers and $15,800 for the prime minister.

After this year’s pay raise, backbench MPs will receive a $211,000 annual salary, according to CTF estimates. A minister will collect $311,500 and the prime minister will take home $422,000.

Leger polling released by the CTF shows 80 per cent of Canadians opposed the MP pay raise in 2024, 80 per cent opposed it in 2023 and 79 per cent opposed it in 2022.

The federal government stopped automatic MP pay raises from 2010 to 2013 in response to the 2008-09 recession.

“Canadians need MPs who will be champions for taxpayers and demand an end to these pay raises, because when politicians pad their pockets, bureaucrats demand more money too,” Terrazzano said. “It’s not rocket science: MPs should do the right thing and stop their upcoming pay raise.”

From the Fraser Institute

By Jake Fuss and Grady Munro

According to a new poll from RBC, nearly half (48 per cent) of Canadians can’t maintain their standard of living due to rising costs. These polling results should come as no surprise; recent research has shown that Canadian living standards are in a historic decline.

Governments across the country should take note, and immediately cut the largest expense for families—taxes.

Consider this. Gross domestic product (GDP) is the value of all goods and services produced in the economy, and is the most widely used measure of economic prosperity. And by measuring GDP on a per-person basis (and adjusting for inflation), we can track how living standards of Canadians change over time.

According to the latest data from Statistics Canada, as of September 2024, GDP per person was $58,601 compared to $59,905 in June 2019 (after adjusting for inflation). And since the fourth quarter of 2022, living standards have fallen in seven of the last eight quarters.

The driving factor behind this decline in living standards is Canada’s sluggish economic growth in recent years. Moreover, as highlighted in the poll, inflation over the last several years has left Canadians weary and struggling to cope with the elevated cost of necessities such as food and housing.

Again, if governments want to help improve living standards, they should reduce taxes and leave more money in the pockets of Canadian families.

In 2023 (the latest year of comparable data), the average Canadian family spent a larger share of its income on taxes (43.0 per cent) than on food, shelter and clothing combined (35.6 per cent). In other words, taxes are the largest single expense for Canadian families, and governments have the power to lower this expense to help families make ends meet.

Tax reductions would also benefit the overall economy and increase opportunities for workers. Across a variety of income levels ranging from $50,000 to $300,000 a year, Canadians in nearly every province face a higher combined (federal and provincial/state) personal income tax rate than Americans in virtually every U.S. state.

Of course, jurisdictions compete to attract and retain high-skilled workers such as doctors, engineers and entrepreneurs because these individuals contribute greatly to overall economic growth. By maintaining higher tax rates than U.S. states, provinces remain at a competitive disadvantage in attracting these workers. Lowering both federal and provincial income tax rates would improve Canada’s competitiveness and help increase economic growth.

A stagnant economy and rising cost of living are reducing living standards while stretching the finances of Canadian families. This budget season, governments from coast to coast should lower taxes to improve the economy and put more money back in the pockets of hard-working Canadians.

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Policy Analyst, Fraser Institute