Canada’s top 1% saw fastest income acceleration, overall decrease in taxes

Those in the top one per cent saw average income growth in 2017 of 8.5 per cent to $477,700

The incomes of Canada’s top one per cent grew at a faster pace than everyone else in 2017 — and, overall, they saw their taxes edge down, says a new study.

Statistics Canada has found that in 2017 the average total income of all tax-filers rose 2.5 per cent to $48,400 compared to the previous year. The average income growth of the bottom half of tax filers increased 2.4 per cent to $17,200.

But those in the top one per cent saw average income growth that year of 8.5 per cent to $477,700.

And biggest surge in income growth was seen by those who made even more money.

Tax filers in Canada’s top 0.1 per cent, who made at least $740,300 in 2017, took home 17.2 per cent more income than in 2016. People in the top 0.01 per cent, who made $2.7 million or more, saw their incomes rise 27.2 per cent — making for the fourth-biggest annual increase in the last 35 years.

READ MORE: B.C. seniors’ poverty rate highest in Canada: report

The report’s release comes with the federal election campaign in full swing — and political pledges on taxes and helping regular folks with their finances have been prominent.

In 2016, the Liberal government increased the tax rate on income in the highest bracket. But the Statistics Canada report says that, even with the boost, taxes declined for those with the highest incomes because of reductions at the provincial level, especially in Quebec.

At the federal level, the report says, those in the top one per cent have been paying higher taxes since the government created a fifth tax bracket in 2016, which nudged the effective tax rate of people making the most money to 18.8 per cent from 18.4 per cent.

The overall effective tax rate, however, for those in the top one per cent declined to 30.9 per cent in 2017, down from 31.3 per cent the year before, the study says.

By comparison, all individual taxpayers, on average, saw an effective tax rate of 11.4 per cent in 2017, while families paid a rate of 12.2 per cent.

Families with kids, with incomes near the median, saw a lower federal rate because of a slight boost from enhanced tax-free child benefits, the report said.

The effective tax rate in the study is calculated by tallying the taxes paid at the federal and provincial levels as well as employee contributions to employment insurance and to the Canada and Quebec pension plans.

During the election campaign, major political parties have announced packages of tax credits and reductions, mostly directed at families.

For example, Conservative Leader Andrew Scheer announced a $6-billion plan to gradually lower income taxes — to 13.75 per cent from 15 per cent — over several years for the lowest federal bracket, which is applied on income between $11,809 and $47,630.

Liberal Leader Justin Trudeau promised to make the first $15,000 of income tax-free for people making $147,667 a year or less.

NDP Leader Jagmeet Singh has pledged to raise the top marginal tax rate — on income over $210,000 — by two percentage points to 35 per cent. Singh has also vowed to introduce a one-per-cent annual wealth tax for Canada’s “super-rich millionaires” — those worth more than $20 million.

When it comes to a breakdown of Canada’s top money-makers, the report said the one-per-cent club had 277,695 members in 2017, and 2,780 tax filers were in the top 0.01 per cent.

The vast majority — or 92.1 per cent — of those in the top one per cent in 2017 lived in Ontario, Alberta, Quebec or British Columbia.

Women made up 24.2 per cent of earners in the top one per cent, up from 23.9 per cent the previous year — and more than double their proportion in 1982.

Andy Blatchford, The Canadian Press

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Coastal GasLink pipeline investor committed to closing deal despite protests

Developer TC Energy Corp. — formerly TransCanada Corp. — is to remain the operator of the $6.6-billion pipeline

Potholes in Vanderhoof recurring due to weather, says district office

Potholes in Vanderhoof are being fixed, but ‘northern winter weather’ is the… Continue reading

Northern Health recommends self-quarantine for people returning from Hubei

The healthcare provider said it isn’t neccessary for healthy children to wear face masks

Wet’suwet’en return to camps near Houston, Coastal GasLink workers move through: First Nation

Opponents of a pipeline who support the Wet’suwet’en hereditary chiefs have reoccupied camps at centre of arrests

Still no contract for Canada Post workers

Vanderhoof postal workers will wear black every Friday to raise awareness about their situation

Pipeline dispute: Tories put no-confidence motion on House of Commons agenda

Conservatives say they have no confidence in the Trudeau government to end the rail blockades

Province shows no interest in proposed highway between Alberta and B.C.

Province says it will instead focus on expanding the Kicking Horse Canyon to four lanes

First case of COVID-19 in B.C. has fully recovered, health officer says

Three other cases are symptom-free and expected to test negative soon

A&W employees in Ladysmith get all-inclusive vacation for 10 years of service

Kelly Frenchy, Katherine Aleck, and Muriel Jack are headed on all-expenses-paid vacations

Via Rail lays off 1,000 employees temporarily as anti-pipeline blockades drag on

The Crown corporation has suspended passenger trains on its Montreal-Toronto and Ottawa-Toronto

VIDEO: Knife-wielding man arrested after barricading himself in Lower Mainland Walmart

A man had barricaded himself in the freezer section of the fish area at a Walmart in Richmond

Budget 2020: Weaver ‘delighted,’ minority B.C. NDP stable

Project spending soars along with B.C.’s capital debt

B.C. widow ‘crushed’ over stolen T-shirts meant for memorial blanket

Lori Roberts lost her fiancé one month ago Tuesday now she’s lost almost all she had left of him

Higher costs should kill Trans Mountain pipeline, federal opposition says

Most recent total was $12.6 billion, much higher than a previous $7.4-billion estimate

Most Read