VANCOUVER—The average Canadian family spent 42 per cent of its income on taxes in 2025—more than on housing, food and clothing combined, finds a new study published by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

“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 Taxes Versus the Necessities of Life: The Canadian Consumer Tax Index 2026 Edition.

The total tax bill for Canadians includes visible and hidden taxes paid to the federal, provincial and local governments. They include: income taxes, payroll taxes, health taxes, sales taxes, property taxes, fuel taxes, carbon taxes, vehicle taxes, import taxes, alcohol and tobacco taxes, among other taxes.

In 2025, the average Canadian family (with an income of $121,111) paid $50,721 in total taxes. In other words, the average family spent 42 per cent of its income on taxes compared to 36 per cent on housing, food and clothing combined.

This is a dramatic shift since 1961 when the average Canadian family spent much less of its income (33.5 per cent) on taxes than the basic necessities (56.5 per cent). Taxes have grown much more rapidly than any other single expenditure for the average family.

And since 1961 the average Canadian family’s total tax bill has increased nominally by 2,928 per cent, dwarfing cost increases in housing (2,349 per cent), food (952 per cent) and clothing (526 per cent).

“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 and how much the tax burden has grown relative to other necessary costs they must pay,” Fuss said.

Fraser Institute——Bio and Archives

The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 86 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute’s independence, it does not accept grants from governments or contracts for research. Visit fraserinstitute.org.

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