According to the Canadian Taxpayers Federation, the National Debt is now close to $1.21 trillion dollars, which amounts to $30,602 per Canadian. The government expects to pay more than $46.5 billion to service the debt for 2023/24. This exceeds 10% of the federal revenue threshold, recommended by David Dodge, former Bank of Canada Governor. A report from the Fraser Institute states: “In 2021, the average Canadian family (in which two partners are working) earned an income of $99,030 and paid total taxes equaling $42,547 (43.0%).” What does this mean on Cortes Island? Or in Area C?

According to the 2021 census, only 255 Cortes Island residents reported a personal income of more than $50,000. (30 people earned $100,000 or more.) That’s a little more than a quarter of the population for whom high income taxes are a reality. 

The median individual income on Cortes was $29,400, of which approximately $1,600 went to income tax. There were also 250 residents whose income was less than $20,000, which means they probably did not pay any income tax. 

This does not mean that Cortesians aren’t working. We had a workforce of 490, of which 220 were ‘full time employees’ and most of the others were ‘self employed.’ (Many are allegedly juggling two or more jobs.) 65 people reported they had seasonal employment and 70 collected employment insurance. The average work year is 39.4 weeks for men and 30.4 weeks for women.

Another 375 residents were over the age of 65 and presumably collecting pensions. 

The median income is slightly higher in Area C, $33,200 – of which an average of $2,400 is collected for income tax. 

Area C has a workforce of 1,105 people: 400 of which are self employed,  685 call themselves employees and 20 are not designated.  The average work year is 36.5 weeks for men and 38.4 weeks for women.

There are also 1,010 people over the age of 65, who presumably collect government, and possibly other, pensions. 

For most Discovery Islanders the real concern about the Government’s rising debt would appear to be its financial stability rather than increased income and other taxes. (I.E.- Are we heading for a financial collapse?)

This is one of those areas where we start having to compare conflicting statistics. 

The CBC recently reported that the federal debt has doubled from $619.3 billion CAN in 2015-16, the year that Prime MInister Justin Trudeau’s government, to $1.2 trillion CAN last year and is expected to climb to $1.4 trillion CAN by 2028-29.

As a result of increased interest rates, servicing the debt will cost $46.5 billion this year as compared with 20.3 billion in 2020-21 and is expected to reach $60.7 billion in the next five years. 

According to the National Post, “while Canada is still doing exponentially better than the debt burdens of places like Japan or the US, discussions of debt often contain a pretty glaring omission: They don’t account for Canada’s remarkably high rate of sub-sovereign debt. As a result, when the debt from all Canada’s 10 provinces is mixed in with its total federal debt, Canada suddenly emerges as one of the more indebted nations in the developed world.”

Most of our peer nations have little if any sub-sovereign debt, but “if Canadians were somehow able to pay every single dollar they earned towards paying off government debts, it would still take about 13 consecutive months before the debt was paid down.”

CEIC Data describes a much better situation. Prior to COVID the current Canadian Government’s public debt was less than that of the preceding Harper regime. It reached a peak of 1.5 trillion US in March 2022 and has been declining since then. 

They claim Canadian Government debt accounted for 68.6 % of the country’s Nominal GDP in Mar 2023, compared to 73.3 % in the previous year. This is much better than the all-time high of 83.6 % in Mar 1996, at which point Prime Minister Jean Chretien enacted cutbacks.

See also ‘Canada’s National Debt,’ a series of short articles compiled during the 2019 election

Correction: The income charts in this article originally had an ‘other’ column, in addition to ‘men’ and ‘women.’ This was Cortes Currents error. I initially thought that, for example, the error in the $10,000 line of the Cortes charts (175 people, consisting of 95 ‘men’ and 75 ‘women’) was probably because of people who did not want to be labelled ‘men’ or ‘women.’ So I added an ‘other’ column. After publication, I realized the more obvious fact that all the numbers are multiples of 5.

Top image credit: Canada’s Prime Minister, Justin Trudeau – Photo by Hailey Sani via Flickr (Public Domain)

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