Federal income tax arrived as a wartime emergency measure. Prime Minister Sir Robert Borden introduced a tax on business profits in 1916 and, on September 20, 1917, the Income War Tax Act received Royal Assent — a "temporary" levy meant to fund Canada's participation in the First World War. The government never repealed it: post-war debt made the revenue impossible to give up, and personal income tax has been collected continuously ever since, marking well over a century in force.

Canada's tax brackets and rates have been revised constantly since then — most recently with the federal government cutting the lowest bracket from 15% to 14%, effective July 1, 2025, the first cut to that bracket in years.

The GST is much younger. Brian Mulroney's government introduced the Goods and Services Tax on January 1, 1991, at a 7% rate, replacing a hidden 13.5% manufacturers' sales tax that had made Canadian exports less competitive. The GST was deeply unpopular at launch — it made previously invisible tax visible on every receipt — and contributed to the collapse of Mulroney's Progressive Conservative party in the 1993 election. Decades later it remains, now reduced to 5%, and several provinces have since harmonized it with their own sales tax into a single HST.

Quebec took a different path, keeping a separate QST (now 9.975%) collected alongside the federal GST rather than harmonizing — a distinction that still shows up on every Quebec receipt today.