Tax Freedom Day, the day when Canadians start working for themselves after paying off the total tax bill imposed on them by all levels of government, falls on Monday, June 6, two days later than in 2010, according to the Fraser Institute’s annual Tax Freedom Day calculations.
The primary reason Tax Freedom Day falls on June 6 in 2011, two days later than 2010, is Canada’s improving economy, found the institute's report. In 2010 and 2011, the economy rebounded following the recession and Canadians witnessed a later Tax Freedom Day in both years.
Several provinces increased taxes in 2011, which contributed to the later Tax Freedom Day, said Niels Veldhuis, Fraser Institute senior economist and co-author of Canadians Celebrate Tax Freedom Day on June 6, 2011. For example, Quebec increased its provincial sales tax, fuel and mining taxes and health tax. British Columbia increased its Medical Services Plan premiums, while Manitoba and Prince Edward Island both increased tobacco taxes.
Tax Freedom Day varies from province to province, depending on the taxation levels of provincial and local governments. Alberta continues to enjoy the earliest Tax Freedom Day on May 18, followed by Prince Edward Island on May 27, then New Brunswick on May 31. Manitoba’s Tax Freedom Day falls on June 1, followed by Ontario (June 4), Saskatchewan and British Columbia (June 6), Nova Scotia (June 7), and Quebec on June 10. Newfoundland and Labrador has the latest Tax Freedom Day, June 19.
All Canadian provinces, except Saskatchewan and Newfoundland and Labrador, experienced a later Tax Freedom Day in 2011 than in 2010. Quebec recorded the largest increase in Tax Freedom Day, four days later than in 2010.
Tax Freedom Day calculations are based on forecasts of personal income and on federal and provincial budget tax revenue.
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