As tax filing deadline looms, The Conference Board of Canada measures personal and business tax burdens
OTTAWA, May 2, 2016 /CNW/ - New Brunswick has one of the lowest provincial net business tax burdens among the provinces, but individual New Brunswickers face one of the highest burdens, according to a new report from The Conference Board of Canada, Benchmarking Provincial Tax Burdens.
- New Brunswick's provincial corporate income tax burden, as a percentage of gross output in the business sector, is the lowest among the provinces.
- New Brunswick is second only to Saskatchewan for the lowest provincial net business tax burden.
- Personal income taxes are low, but individuals' overall tax burden slips compared to other provinces when social security contributions, property taxes and the sales tax are included.
This report compares the provincial tax burden on businesses and individuals among provinces based on the calculation of average provincial tax burden ratios. The analysis is based on data through 2011 for business taxation and 2012 for personal taxation (which were the most recent data available at the time this research was completed).
"New Brunswick is second only to Saskatchewan for having the lowest provincial net business tax burden," said Julie Adès, Senior Economist. "However, New Brunswick's personal tax burden is the third highest among the provinces, behind only Quebec and Nova Scotia."
New Brunswick's income, profits, and capital gains taxes paid by corporations, as a percentage of gross output in the business sector, is the lowest among the provinces. This finding is based on data ending in 2011, and does not incorporate the increase in the New Brunswick corporate income tax rate from 10 to 12 per cent, adopted in 2013.
The provincial personal income tax burden in New Brunswick, measured as a ratio of provincial personal income tax to household income, is among the lowest across the country. This analysis does not include the new tax brackets that the province introduced in 2015, starting with those whose incomes exceed $150,000.
The Conference Board's analysis went one step further by assessing implicit personal income tax rates in five income ranges—$0 to $29,000; $30,000 to $49,999; $50,000 to $69,999; $70,000 to $99,999; and $100,000 or more. For all income ranges below $100,000, New Brunswickers' tax burden ranks in the middle of the pack among the provinces.
New Brunswick's individual tax burden, relative to the other provinces, increases when social security contributions, property taxes and the sales tax are added to provincial personal income taxes. The province's overall ranking slips to the third-highest burden.
This report does not assess the goods and services financed by governments through tax revenues.
Business taxation includes: provincial corporate income taxes, social security contributions paid by employers, payroll taxes, and property taxes and provincial sales taxes, as well as the provincial segments of the HST.
Personal taxation includes: provincial personal income taxes, social security contributions paid by employees, property taxes, and provincial sales taxes as well as the provincial segments of the HST.
Join Julie Adès and Matthew Stewart for a live webinar to discuss the findings for all provinces on June 1, 2016 at 3 PM AT.
The report was produced for the Centre for Tax Analysis, Fiscal Incentives and Competitiveness (TAFIC). Launched in 2014, TAFIC provides Canadian business leaders and policy-makers with credible, leading-edge quantitative research on all aspects of the Canadian system of taxation and fiscal incentives. Using sophisticated econometric tools to measure the impact of proposed reforms on the Canadian economy, TAFIC publishes evidence-based and accessible reports on key issues related to taxation and fiscal incentives.
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