It’s the start of a new year, and while many are excited about new beginnings, Canadians face a different kind of "new" – a slew of new taxes!
Mr. Trudeau and the Canadian government have announced several tax increases for 2025, impacting various aspects of our lives, from the cost of the food we eat and the gas we put in our cars to the drinks we used to enjoy.
This article from “The Facts that Matter” explores the changes and discusses how they will affect us all.
THE CARBON TAX
One of the most talked-about tax changes is the increase in the federal carbon tax. This tax supposedly encourages Canadians to drive less and take public or alternate transportation. That may work for some. But what about the rest of us who are forced to pay when we do not have convenient public transportation or live in rural, remote Indigenous, and northern communities? The more energy we use, the more we pay.
The carbon tax will increase from $80 to $95 per tonne in 2025. This might sound like a small number, but it significantly impacts the prices of gasoline, diesel, natural gas, and food.
The increase translates to an additional 21 cents per litre for gasoline, 25 cents per litre for diesel, and 18 cents per cubic meter of natural gas. That means filling up your car's gas tank will cost approximately $500 more annually.
The added cost for vegetables will be approximately $0.09 per kilogram, or a 4% increase. Just those two items alone will add an average of 7% to your household costs, and we have not added heating and all the other things impacted.
All I can say is read it and weep.
IS THE CARBON TAX REVENUE NEUTRAL?
The government argues that the carbon tax is "revenue neutral. Do you really believe that? When has the government taken on a huge issue that will not increase revenue? Never. I was not born at night, and I do not think you were either.
PAYROLL TAXES: A HIT TO THE PAYCHEQUES
For those working, there's bad news on the payroll tax front. The federal income-based payroll tax is increasing for people earning over $64,000 a year. The increase will range from $355 to $403, depending on your income. This means approximately one percent less money in your paycheck each month. So look for a minimum of $36 less on your pay cheque
ALCOHOL TAXES; A COSTLY DRINK
Who does not enjoy an occasional drink? Even with one of life’s tiny life’s pleasures, you will feel the pinch. Federal excise taxes on alcohol (beer, wine, and spirits) are increasing by 2%.
THE BIG PICTURE
These tax increases are part of the government's plan to pay for the debt.
The taxes are needed as we are now deeper in debt. Part of this is our fault, as we have enjoyed government largess, but who has explained or warned us about the impact? Nobody and the government keeps spending, putting us further in debt.
For example, in 2022, the federal government spent 7.4% of its budget for the interest on debt. In 2024, that has increased to 10.2%. No wonder Trudeau and the Liberal government are trying every way, by hook or crook, to collect more tax.
WHAT CAN CANADIANS DO?
1. Understanding the details of these tax changes is the first step. Learning how each increase affects your finances is crucial for making informed decisions, and we at www.factsthatmatter.ca are here to help.
2. Think about who to vote for the next time around. Do you vote for the party you have consistently voted for or look for a change?
3. Consider signing up for information from the Canadian Taxpayers’ Federation. They are excellent at identifying the pork.
CONCLUSION
These tax increases will significantly affect the financial well-being of Canadians. Staying informed and understanding your options when you go to the ballot box is your best weapon against government tax increases in the financial landscape
Remember, informed decision-making empowers you to decide what you want to accept for your future. The longer we wait to take action, the more painful it will be.
Best wishes ... and Happy New Year!
"Facts that Matter" is a path to a better understanding of things that affect us all. Global Warming, Climate Change, the Circular Economy, politics and much more. Our goal? To make knowledge available to help you make informed decisions based upon the "Facts that Matter."
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