Tuesday, June 26, 2012

Canada and Tax Freedom Day

A number of organizations in different countries usually on the right calculate what is called Tax Freedom Day. This is the day when if all your income went to pay your taxes up to then on that day you would be free and the rest of the year your income would go in your own pocket and not to the government.

Different countries have vastly different tax freedom days. The U.S. was on April 12 in 2011. Canada is a whole month later at June 12 th this year. However the latest listed here is Norway on July 29th. One might think that Norway must be a terrible place to live. However this site ranks Norway the number one country in the world to live a ranking it has held for some time.

The Tax Freedom Day somehow assumes that you are not really free until you stop paying the government. However for your taxes you receive services often services that benefit you personally. Norway for example has an extensive universal health care system that includes drugs.

If the Tax Freedom Day people wanted to be fair they should have a mortgage freedom day, the day that you finished off paying your mortgage for the year. Or there could be an Auto Financing Freedom Day. However, David Macdonald has a different twist on Tax Freedom Day.

MacDonald suggests there should be a freedom from government services day. He calculates a freedom from Medicare day. Although much medical care is paid by government insurance in Canada there are still quite a few medical expenses paid by the individual. This has been increasing over time.

In 1980 all our medical expenses were paid until Nov. 6 according to MacDonald. By 2011 the date was October 13th . We gained over a month of freedom in which we could pay for expenses all on our own. The period during which we must pay our own way without government help has been increasing every since 1980. Our freedom is increasing. For more see this article.

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