Taxes up 1600%? I think not.

CTV News story.
CTV News is reporting today on a Fraser Institute Report that our taxes are up 1600% since 1961. I don’t know what hat they pulled that figure from. Let’s look at the details:

In 1961, the average income per household was $7,582 before taxes, and $5,000 after taxes, and an average family spent $2,824 on food, shelter and clothing per year.

Doing some math shows that the $2582 taken by the government for taxes in 1961 is 34.1% of the average household income. Food, shelter and clothing represents 37.2% of the average household income the same year

In 2005, the report found, the average family earns $95,531 before taxes, takes home $60,903, and spends $22,167 on food, shelter and clothing.

Again, doing the math, the $34628 taken by the govrenment in taxes in 2005 is 36.2% of the average family income. Food, shelter and clothing represents 23.2% of the average family income the same year.

I see an increase of 2.1% in taxes and a decrease of 14% on food, shelter and clothing. You cannot directly compare the dollar amounts from 1961 with the dollar amounts from 2005 unless you take into account all the changes in the economy in the intervening years. Comparing the percentages from each year gives meaningful results.
Where did that 1600% figure come from anyway?

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