Boomer Bust

Millennials are getting one of the biggest tax bills in history.

- Max Fawcett

For the first time in their history, baby boomers are now outnumbered by another generation. When Canadians head to the polls in October, millennials — roughly 10 million of them — will have the numerical edge. And with that edge, as research firm Abacus Data recently noted, comes the power to “disrupt the status quo.” Millennials are already directing that power towards things they’re allegedly killing (like mayonnaise and motorcycles) and ones they’re apparently saving (like postcards and RVs). But when it comes to public finances, their impact is conspicuously absent — and if a recent report from the C. D. Howe Institute is any indication, they might want to get busy disrupting.

In that report, researcher Parisa Mahboubi focuses on so-called generational accounting, which measures the taxes each generation pays against the services they receive in order to reveal the long-term impacts of current fiscal policy. “The main question for generational accounting,” Mahboubi writes, “is who pays for an increase in government spending: current or future generations.” Borrowing from the future in order to pay for the present has long been a popular political strategy, but the numbers laid out in Mahboubi’s report are sobering. Her projections reveal that a Canadian born in 2017 will pay $736,000 in taxes over their lifetime — a sum that will go disproportionately towards subsidizing health care and other age-related costs of baby boomers and other older Canadians.