How Do Canadian Tax Rates Compare to the Rest of the World?

When I travel to the U.S., I inevitably end up in conversation with someone about where I live and how I feel about our tax rates.  And while generally speaking, Canadians pay more taxes compared to our American counterparts, it becomes a bit more complicated when you consider what Canadians get for those taxes, and of course everyone’s individual tax situation, too.
So how do we compare against the rest of the world?  Surely we must be on the high end of the tax spectrum, right?

It may surprise you to know that we don’t even make the top ten when it comes to the world’s most heavily taxed countries, according to recent data from the Organization for Economic Co-operation and Development (OECD).  In fact, among the countries tracked in that study, we sit at a respectable 11th, with our top statutory income tax rate and top marginal all-in rate sitting at 46.4 per cent.  To compare, Sweden sits at #1, with its tax rates about ten per cent higher at 56.6 per cent.  Who’s complaining now, right?

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Interestingly, in many cases, countries with higher tax rates tend to fare better when it comes to “best places to live” surveys.  While there are a variety of different markers that each consider different factors when determining if a city or country should top the list, countries like Sweden, Austria, Finland, Denmark – and of course, Canada – tend to rank high.  In fact, in a new OECD publication How’s Life? Canada was ranked number two (just behind Denmark) out of 40 countries when it came to 11 specific aspects of a great life – from income, jobs and housing to health, education and the environment.

So the next time you hear someone smirk at our taxes in Canada, just ask them where their country ranks among the world’s best.

7 Responses to How Do Canadian Tax Rates Compare to the Rest of the World?

  1. Interesting stuff. I think perception has a lot to do with how people view their nation’s tax rate. If you’re satisfied with the services you receive then you probably don’t mind paying a bit more, but if your neighborhood is ripe with crime, poor schools, and shoddy services then you’ll probably think you’re not getting what you pay for even if your tax rate is low.

  2. It’s interesting isn’t it! People seem to think less taxes will raise their liberty and their ability for them to lead a better life for themselves without interference… However in many cases it seems the countries that spend the time to try and care for everyone (higher taxes being part of that) often rank way higher in lifestyle surveys!

  3. The only interesting aspect of this article is apparently there are any people who take it seriously.
    The author, of course, ignores the fact that many of these “liveability” surveys heavily weigh “big government” policies. Not surprisingly, the northern socialist states do well under these criteria.

  4. My issue is that our taxes are forever increasing here in Canada. I don’t think it will be long before Canada IS IN the top 10. The best thing one can do is hire a great Accountant!

    I’m just looking for a good balance from all 3 levels of Govt. Am I asking too much?

  5. Well if they managed the taxes well ,we would not be bit$hing…over 500 billion debt Fed,120b Prov. and 2b local…you will not see any Swedes moving here

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