Several variables explain why the poor fared better during the pandemic. First, people in the two lowest-income quintals received huge government aid, which far outweighed the loss caused by less work.
The root cause, according to Cross, was the flawed design of income support programs; They not only replaced lost revenue for households, but increased it significantly across the economic spectrum. Overall, low-income Canadians used the unexpected increase in their income to pay off debt, which improved their net worth.
In addition, the nationwide housing boom increased the value of most people’s homes. However, the rich benefited proportionately less because of the lesser amount of their wealth in housing. Simultaneously, many middle-class Canadians took out huge mortgages (usually to get out of overcrowded cities during COVID), slowing their net worth growth.
So has the pandemic changed the “wealth tax” debate?
Cross argued that during the pandemic, there was no apparent increase in support for the property tax. An estate tax was apparently not seen immediately to influence many votes in Canada.