The Canadian Taxpayers Federation (CTF) notes in a news release that the proposal for a ‘temporary’ War Tax Upon Incomes, which later became the Income Tax Act, was first introduced in the House of Commons by Conservative Finance Minister Sir William Thomas White on July 25, 1917, 100 years ago this week.
“Sir White brought in the income tax to pay for the cost of World War I but unfortunately Canadians have been stuck with it ever since,” said CTF Federal Director Aaron Wudrick. “His original 11-page law with a four per cent tax rate has ballooned into today’s 3,100-page behemoth.”
The Canadian Taxpayers Federation has crunched the numbers and we have paid a cumulative $4.9 trillion in federal income taxes over the past 100 years. To put this into context, this amount in $100 bills laid end to end would circle the earth at the equator 186 times.
Records of House of Commons debates from 1917 show Sir White’s fear that his ‘war tax’ would become permanent – a fear which ultimately came to pass. By 1948 the Income Tax Act had grown to 88 pages, and by 1970 many argued it had become too complicated for the average Canadian at 424 pages.
“To paraphrase Milton Friedman, there is nothing so permanent as a temporary tax, and Canadians still paying a ‘war tax’ for a war that ended 99 years ago is a clear example,” said Wudrick. “Canadians should bear this $4.9 trillion number in mind every time a politician proposes to introduce yet another new tax.”
