The Canadian Taxpayers Federation (CTF) is warning Canadians of major tax hikes next year that will leave them with less in their pockets.
According to their 2024 New Year’s Tax Changes report, payroll and carbon taxes are set to jump again, as is the escalator tax on alcohol.
Like 2023, the new year will see taxpayers pay more for less as the average Canadian family will pay 46.1% of its budget in taxes, according to the Fraser Institute. That is up from 43% this year.
“Tax hikes will give Canadians a hangover in the new year,” said Franco Terrazzano, Federal Director of the CTF. “Canadians need help with the rising cost of living, but the feds will be reaching deeper into our pockets with major tax hikes in 2024.”
“Other countries are cutting taxes, but Ottawa is sticking Canadians with higher bills,” he added.
For workers making $73,200 or more, federal payroll taxes, including the Canada Pension Plan (CPP) and Employment Insurance (EI), will cost them $347 more in 2024. These taxes will cost workers $5,104 next year, with employers on the hook for $5,524 per employee.
Because of the payroll tax hikes, anyone making $40,000 or more in 2023 paid higher federal income-based taxes than in 2022, reported the taxpayers’ group. That continues to be the case next year.
On April 1, 2024, Ottawa is continuing its long-standing tradition of hiking the carbon tax annually, with drivers awaiting another 17-cent increase to the price of gas and 15 cents for natural gas.
It will cost the average household between $377 and $911 next fiscal year after receiving climate action rebates, according to the Parliamentary Budget Officer (PBO). The cost of gas rose 14 cents per litre last April 1, costing the typical household between $402 and $847 in 2023, even after the rebates.
For the alcohol escalator tax, alcohol taxes will increase by 4.7% next April, following a 6.3% hike this April.
According to CTF, taxes account for roughly half the price of beer, 65% of the price of wine and more than three-quarters of the price of spirits. This tax hike will cost Canadians almost $100 million next year.
“Canadians pay too much tax because the government wastes too much money,” Terrazzano said. “Canadians need relief now, and that means Prime Minister Justin Trudeau must drop his plans to raise taxes in 2024.”