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Victory Bonds and War Savings Stamps

War is an expensive proposition. Equipment must be purchased; workers paid; soldiers, sailors, and airmen outfitted, trained and fed; and military infrastructure built. Taxes can be raised, but if they are raised too sharply, they will slow growth and production.

The Canadian Government did raise taxes during the Second World War to help offset the cost of financing the war. The increased revenue from higher taxes accounted for about one-half of all war-related expenses. To help pay for the rest, the Canadian government turned to an old idea: Victory Loans drives. Used by many nations to raise funds during the First World War, the federal government authorized the establishment of various bonds and savings certificates for purchase by the Canadian public.

Victory Bonds were a financial instrument with a fixed interest rate and expiration date. The issuer, the Government of Canada, sold these bonds to raise funds to help finance the war effort. Purchasers—individuals, businesses, banks, and so on—bought the bonds from the government at an established face value, and, in return, received their initial investment plus interest when the bond matured (usually in several years).

War Savings Certificates

For those who could not afford to buy Victory Bonds, the government also issued War Savings Certificates. The certificates were issued upon application accompanied by cash, cheque, or money order payable to any bank, post office, or authorized selling agency. The affordable 25-cent stamps could be purchased by just about every Albertan at a local bank or post office. War Savings Certificates and Stamps were an ideal way for children to contribute to, and participate in, the war effort. A grouping of 16 stamps equalled $4; each certificate could potentially be redeemed seven and a half years later for $5.

The government conducted nine Victory Loan drives between June 1941 and October 1945. These campaigns raised nearly $12 billion by the end of the war. To eliminate conflict between charitable organizations such as the Red Cross, which conducted its own fundraising campaigns to help support families and military personnel, and Victory Loan workers seeking to fill their appointed sales quotas, the government imposed an offsetting schedule in 1941. Victory Loan campaigns were to be conducted during the summer and winter months of each year, and charitable organizations were allowed to raise money during the spring and fall. Advertising campaigns, many featuring celebrities, encouraged Canadians to set aside money from every paycheque to purchase bonds and savings certificates and stamps.

By the beginning of 1942, it was clear that the various voluntary savings and tax initiatives implemented by the government were falling short of their mark. The government imposed a new compulsory “savings” plan. By way of this plan, individuals were required to lend the government a percentage of their earnings; money to be repaid at the end of the war. For example, an individual earning $3,000 a year was required to lend the government $1,200. This compulsory “savings” initiative ultimately led to an increased level of tax evasion and was repealed in 1944.


Barnett, Enid. Keynes's How to Pay for the War in Canada: The Story of Compulsory Savings, 1939-1944. Kingston, Ontario: Harbinger House Press, 2001.

Bryce, Robert B. Canada and the Cost of World War II: The International Operations of Canada's Department of Finance, 1939–1947. Montreal: McGill-Queens University Press, 2005.

Howe, C.D. “Civilians to Help by Curbing Buying.” The Globe and Mail, 1 August, 1942.

King, William Lyon Mackenzie. “Canada and the War, Total War and Total War Effort: An Appeal for War Savings.” [Radio broadcast]. Ottawa: E. Cloutier, Printer to the King, 1941.

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