It's Just An Economy

Prepare for the worst, Canada!

You voted for it:

Prime Minister Justin Trudeau will increase his carbon tax by $10 to $50 per tonne of emissions on April 1, 2022 — up 25% from this year’s $40 per tonne levy — rising to $170 per tonne in 2030.

When fully implemented, Trudeau’s carbon tax will add 38 cents per litre to the cost of gasoline alone.

The federal government is now raking in billions of dollars annually in new revenue from carbon taxes.

Contrary to its claim of revenue neutrality, parliamentary budget officer Yves Giroux reported last year this is not the case because revenue from the federal GST, levied on top of the carbon tax, is not refunded to taxpayers.

Federal carbon tax rebates to offset the increased cost of living Canadians face because of Trudeau’s carbon tax only apply in Ontario, Alberta, Saskatchewan and Manitoba.

While Ottawa has claimed 80% of households in these provinces end up better off financially because of the rebates, federal officials told The Canadian Press in 2019 this decreases to 70% when indirect price increases are added to direct costs such as higher gasoline and natural gas prices for home heating.

 

 

What a difference a day made:

As they count their blessings at the end of another pandemic year, Canadians are also comparing these blessings to a year ago, and finding the present moment tolerable if not outright joyous in contrast, according to a new national poll.

This is especially true for younger people, 18 to 34, for whom last winter marked a high point in the disruption of social lives and careers.

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With the rising costs of everyday items top-of-mind for many, among Canadians who say they took on more debt in 2021. A recent Maru financial priorities poll suggests 37 per cent of Canadians said it was because expenses exceeded their monthly income. In the face of these concerns, only a quarter of respondents (27 per cent) expect their financial situation will improve in 2022.

The survey finds that debt repayment is the number one goal for Canadians for 2022 (20 per cent), while economic worries are focused on inflation (66 per cent), followed by uncertainty due to COVID-19 (36 per cent).

When asked what financial wellness means to them, 47 per cent of respondents say living without financial stress, and also said it was a top descriptor for overall wellness (28 per cent). Four in ten (41 per cent) feel financial wellness comes from being able to afford what they need in life, such as housing, food, or transportation. Half (50 per cent) admit that they wish they were better at saving, while a similar number of Canadians agree that they need to get a better handle on their finances this coming year (49 per cent). Using a Budget Calculator, like offered by CIBC, which offers a clear picture of monthly cash flow to guide making financial decisions can help mitigate stress.

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A slim majority expect their household’s financial situation to stay roughly the same over 2022, and fewer than one in five expect it to improve.

Younger adults, in the 18 to 34 age range, are more inclined to say they will do something expensive than people older than 55, a result that mirrors their general optimism, according to the poll.

But optimism is also higher for people who make more money, and nearly one third of those who earn less than $40,000 a year expect their household’s financial situation to decline over the next six months.

Andrew Enns, executive vice president of Leger, which conducted the poll, said the optimism of people in higher income households tends to track what the virus is doing.

But for lower income households, the main factor is affordability, and if groceries keep going up in price, that can start looking as risky as a COVID infection. People who make less than $40,000 a year tend to be significantly more worried than Canadians at large about the rising costs of goods and services.

Regionally, worry about inflation was lower in Quebec than the rest of Canada, and Quebecers were twice as likely to say they are not worried.

 

Quebec will always have Alberta to sponge off of and public servants (who earn more than the average Canadian) will never lose their jobs.

We're all in this together. 

 

Just to remind everyone that no one in the government lost a pay cheque:

In the midst of the COVID-19 pandemic, with economists predicting a recession on the horizon, parliamentarians will be receiving a combined $2.5 million pay increase effective April 1.

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Member of Parliament (MPs) received their annual salary uptick on April 1st on the same conditions as previous. This year, however, is not a year like any other. The Canadian Taxpayer’s Federation (CTF) slammed MPs for failing to stop this annual pay raise during the economic downturn caused by the COVID-19 pandemic.