By Western Standard
December 27, 2021
January 1 — the day of the calendar most taxpayers hate. When the fog of New Year’s Eve clears, all that’s left is the new levies brought in by various levels of government.
To give people a rundown, the Canadian Taxpayers Federation released its annual New Year’s Tax Changes report on Monday to highlight the major tax changes that will occur in 2022.
“From higher carbon taxes to rising alcohol, payroll and property taxes, there’s a raft of tax hikes coming in the New Year.”
The report outlines the major tax changes from the federal and provincial governments in 2022. Key takeaways from the report include:
- Taxpayers making $40,000 or more in 2022 will see the federal government deduct more money.
- The Canada Pension Plan tax increase will cost workers and businesses an extra $333 each in 2022 (for maximum pensionable earnings).
- The Employment Insurance tax increase will cost each worker an extra $63 in 2022 and businesses an extra $89 (for maximum insurable earnings).
- The increase in the federal personal basic amount will save taxpayers $89.
- The federal carbon tax will increase for the third time during the pandemic to 11 cents per litre of gasoline on April 1, 2022.
- Alcohol taxes will increase for the third time during the pandemic on April 1, 2022. Taxes already account for about half of the price of beer, 65 per cent of the price of wine and more than three quarters of the price of spirits.
The CTF said the governments of Alberta, Ontario, Nova Scotia and Prince Edward Island impose a “sneaky form of income taxation known as bracket creep.”
Bracket creep happens when governments don’t move tax brackets with inflation and inflation automatically bumps taxpayers into a higher tax bracket even though they can’t actually afford to buy more.
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