The average Canadian family spent 42 per cent of its income on taxes in 2025, more than it spent on housing, food and clothing combined, according to a new study from the Fraser Institute.
The public policy think-tank says the average family earned $121,111 last year and paid $50,721 in total taxes, compared with 36 per cent of income spent on the three basic necessities combined.
Tax burden
The study, Taxes Versus the Necessities of Life: The Canadian Consumer Tax Index 2026 Edition, includes taxes paid to federal, provincial and local governments. The Fraser Institute's calculation includes income and payroll taxes, health taxes, sales and property taxes, fuel and carbon taxes, vehicle and import taxes, and alcohol and tobacco taxes, among others.
"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 the study.
The institute said the comparison has changed significantly since 1961, when the average Canadian family spent 33.5 per cent of its income on taxes and 56.5 per cent on housing, food and clothing.
According to the study, taxes have grown more rapidly than any other single expenditure for the average family over that period.
Long-term increase
The Fraser Institute said the average family's total tax bill rose by 2,928 per cent in nominal terms between 1961 and 2025.
That compares with increases of 2,349 per cent for housing, 952 per cent for food and 526 per cent for clothing, according to the study.
The figures are based on the institute's measure of total taxes, which includes both taxes that appear directly on household bills and those it describes as hidden taxes.
The study does not characterize the value Canadians receive from those taxes, but Fuss said the institute believes households should have a clear understanding of the tax burden.
"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 the tax burden has grown relative to other necessary costs they must pay," Fuss said.
The Fraser Institute is based in Vancouver and has offices in Calgary, Toronto, Montreal and Halifax. It describes itself as an independent, non-partisan Canadian public policy research and educational organization.