Who Pays Taxes In Canada ??

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Statistics Canada recently released a study looking at tax shares in that country. It shows that the share of federal income taxes paid by the top 10 percent of taxpayers reached 52.6 percent in 2002 -- almost exactly the same as is paid by the top 10 percent in the United Kingdom. However, the top income tax rate in Canada is just 29 percent. (Provincial tax rates in Canada are very substantially higher than among U.S. states.)

Review:

TOP 10 PERCENT pays 52.6 percent of income tax received
by the Canadian federal government

BOTTOM 90 PERCENT of society in Canada pay 47.4 percent
of all income tax received by the Canadian federal government.



At some point, those on the left must decide what really matters to them -- the appearance of soaking the rich by imposing high statutory tax rates that may cause actual tax payments by the wealthy to fall, or lower rates that may bring in more revenue that can pay for government programs to aid the poor? Sadly, the left nearly always votes for appearances over reality, favoring high rates that bring in little revenue even when lower rates would bring in more.

Edited to remove caps in thread title. Cosmo

In 2005, the top 30 percent of families earned 60.3 percent of all income in Canada and paid 66.3 percent of all taxes.

The bottom 30 percent earned 7.8 percent of all income and paid 4.3 percent of all taxes.

In other words, high-income earners pay more in taxes than their relative share of income would predict.


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Point of Order

Topic headers in Caps are, for lack of a better term, "ew."

Taxes in Canada

Perhaps this "disproportionate" distribution of income retention, on the part of the Government of Canada, is in recognition of the fact that higher-income earners, by the very nature of having a higher-income, can "spare", so to speak, a larger amount of funds to the Government, compared to lower-income earners, where increasing taxes could cause those persons' income to decrease to amounts which would not be enough to meet the standards of living.

TAX FACT: Tax cuts cannot produce a significant improvement in the standard of living of low-income Canadians, for the simple reason that low-income people hardly pay any taxes. Even for middle-income earners, tax cuts won't make much difference.




Sixty percent of Canadians earn less than $25,000 in a year. This majority of Canadians hardly pays any income tax at all - barely 5 percent of their income. Even eliminating their taxes altogether won't make a measurable difference to their quality of life. But more cutbacks to social programs, which will inevitably result from tax cuts, will hurt them badly. Even middle-income Canadians only pay about 20 percent in income taxes, after deductions and exemptions. For them, tax cuts will only marginally enhance their disposable income, while putting important public services (like Medicare) at risk.


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Correction!

50% of all Canadians make $40,000 or less.

Check out the link in my post. Article is November 2000.
And that link is the Canadian Auto Workers Union, the
CAW.

The article is from November 2000. Last time I checked, that was over 5 years ago. Wages have changed since then.

50% of Canadians make $40,000 or less. Hedy Fry said it in the House of Commons just a couple of weeks ago during the debate over the Speech from the Throne.

But we all pay the same price for groceries. 20% tax on a $40,000 salary has a big effect on the ability to feed, clothe and shelter a family.

I don't see what the point is. It is obvious that the higher income earners would pay more. They have more money.

The point is how little the Leftwing realize how much
more the rich do pay.

And how shocked they are that tax cuts always
help those who pay the most in taxes.

Don't shed a tear. But usually the statistics
mentioned below blow their minds.


In 2005, the top 30 percent of families earned 60.3 percent of all income in Canada and paid 66.3 percent of all taxes.

The bottom 30 percent earned 7.8 percent of all income and paid 4.3 percent of all taxes.


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The numbers sort of make sense, to me; the group of people who earns about sixty percent of the income pays in the area of sixty-ish percent of the taxes, and same with the lower groups. I think that such a system is quite appropriate.

I highly doubt it. I'm sure that the left has a good idea of what the breakdown is. In fact, depending on just how left leaning they are, I'd say that they probably don't think that it is enough.

I wonder what makes you so angry as to make such blatant generalisations about such a large number of people.

I don't think it comes to the surprise of many that low income earners pay less tax than high income earners.

Lets not kid ourselves on opportunities presented to the wealthy to substantially reduce their taxes. I think most would be surprised that a wealthy immigrant to Canada can have a 5 year tax exemption on his/her worldwide investment income by way of a foreign trust. Or a wealthy medical practioner could set up a family trust, distribute dividends to the trust then distribute income to individual family members at their individual tax rates.

Complex tax planning and comprehensive tax savings are easy to achieve for the rich. In fact, through them they can have members of their families get paid their income and become classified as low income earners who don't pay tax. Some would even appear in the low income statistics of this thread.

I personally know a couple of millionaires who pay zero personal income tax by virtue of creative accounting. They actually qualify for GST rebates, if you can believe it.

My wife and I make only about 60k a year... Together!!! yeah we suck as income earners but we are lucky we have a very good savings. I'm all for the progressive income tax system and I believe the latest budget in a sence has created a corperate welfare state were now the corperations now get an easy ride.

50% of Canadians make $40,000 or less. Hedy Fry said it in the House of Commons just a couple of weeks ago during the debate over the Speech from the Throne.
----------------JonB2004-------------------------------------

From Statistics Canada website:

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5. Federal personal income tax breakdown.
Statistics Canada recently published a study titled Federal Personal Income Tax: Slicing the Pie, which examines the breakdown of federal personal income taxes paid by high and low income earners in Canada, from 1990 to 2002. Income earners were divided into 3 groups for the study:


10% of taxpayers with the highest incomes This group included taxpayers earning:
over $48,700 in 1990
over $64,500 in 2002

50% of taxpayers with the lowest incomes This group included taxpayers earning:

$19,000 or less in 1990
$23,000 or less in 2002

40%, or remaining taxpayers, with intermediate incomes This group included taxpayers earning:

$19,001 to $48,700 in 1990
$23,001 to $64,500 in 2002

The following tables summarize the results of the study.
a. Share of federal personal income tax paid by the 3 groups of taxpayers in Canada

Income group % of federal personalincome taxes paid
............................................1990.. ........2002
50% with lowest incomes..............6.7%..........4.4%
40% with intermediate incomes.....47.3%........43.0%
10% with highest incomes............46.0%........52.6%

Other tables show much lower compliance
by lower taxpayers


All information in this article adapted from Statistics Canada publication No. 11-621-MIE2005024, April 22, 2005.

Considering the top 10% also happen to own over half the wealth I'd say that's just about right. Probably even with some room to manouver. Also what goes unmentioned is the high-end taxpayers recieve a higher proportion of benefit afforded citizens by the government.

cry me a river

Every Canadian pays taxes daily, in the form of the GST and provincial PST's.
And every time we pay a bill....insurance,utility,water,telephone....GST and provincial PST's are added.
That MUST add up to a fair chunk of income for the federal government.

I really don't see the problem with this.

The Canadian system of taxation

has evolved over years. It would be foolish to expect Canadian taxes to be the same as what Americans, or Brits pay. Canada is a large country with a large infrastructure and a relatively small population. Our taxes are what one would expect in a country like Canada. The percentage of taxes paid by the various economic sectors of the population will change slightly with a change in government but will generally creep back to the levels we have today.

I think that this is a big part of it. Canada, per capita, has way more infrastructure than most states. It is a neccessity simply because of the physical size of our country.

Well, if Hedy Fry said it, it must be true.

The bottom 50 percent of society in both
Canada and United States pay less than 5 percent
of all income tax collected by the national government.

In fact the bottom 50 percent of Canadian society
pays one percent more than the bottom 50 percent
of American society.

Interesting.


CANADA
Income group % of federal personalincome taxes paid
.........................................1990..... .....2002
50% with lowest incomes..............6.7%.........4.4%
40% with intermediate incomes.....47.3%........43.0%
10% with highest incomes............46.0%........52.6%


AMERICA
For Tax Year 2003

Percent Ranked by Adusted Gross Income -------column 1
AGI Threshold on Percentiles ---------------------column 2
Percent of all Federal Income Tax recieved------column 3

Top 1% ..........$295,495...............34.27
Top 5%...........$130,080...............54.36
Top 10%..........$94,891................65.84
Top 25%..........$57,343................83.88
Top 50%..........$29,019................96.54

Bottom 50%...... $29,019............... 3.46

Interesting.

I have to ask here, are we only including the people who work real jobs when we're talking about the bottom 50%? Because if we're including housewives, students, and the elderly who may all work part time I think we're getting a distorted view.

I'm still waiting for the punch line...

I know these stats are tough on the mindset of most
liberals who grew up believing the rich don't pay.

It's not that at all. I'm just using my own common sense and my experience. I didn't pay much in taxes when I went to school and worked part time making about 12K a year, but would you have expected me to? Then I became a rich nurse ( ) and started paying a lot more. I live in the US now and about 1/3 of my income goes to taxes, just like when I lived in Canada. It's annoying, but I wouldn't expect someone who is just like I was 10 years ago (working their way through school) to pay more so I could pay less. That's the problem I have with including all income earners in the stats. Part time employees couldn't possibly be expected to pay a bigger share.

Tracy, good point. This thread is just to get people
to realize what is really happening.

People know, but they don't know.

These stats show, just as in Britain and Australia, so
too with Canada and United States, that the poorer
parts of society contribute less than 5 percent
of all income tax collections.

It shows the US to be little different than the others
contrary to popular perceptions about the wealthy
in America.

It even shows that the more liberal socialistic countries
have the poorer pay a tad more in all income tax
collections.

This is just a picture of the taxes.

It also gets us to realistically debate a question:

The burden is still tougher on that bottom 50 percent.

But here's the rub, if we want the bottom 50 percent
of society to contribute less than 5 percent or maybe
down to zero percent, will their political persepective
of the situation become LESS RESPONSIBLE ???

This is just insulting. To suggest such a blatant generalization is just showing ignorance.

LittleRunningGag, my apologies to you.

But rare is the headline about tax cuts a balanced
report as these stats indicate. And rare is it liberals
who acknowlege how much the rich do indeed pay.
We all agree they should.

But how noble of us, eh ?

These stats are a double edge sword.

Not only do they show how much the rich pay and
how little the bottom 50 percent contributes...

BUT...
it also shows a great disparity between the rich and poor
and is indicative of the bell curve of human achievement
and different starting advantages.



We all know:
The burden is still tougher on that bottom 50 percent.

But here's the rub, if we want the bottom 50 percent
of society to contribute less than 5 percent or maybe
down to zero percent, will their political persepective
of the situation become LESS RESPONSIBLE ???