Competition from the United States matters most to Canadian corporations. This study provides a brief but comprehensive comparison of the overall tax level on corporations in Canada and the United States and provides a detailed breakdown of all types of taxes collected from Canadian corporations since 1950.
Are Corporations in Canada Paying Their Dues? Evidence of Taxes Collected over the Last Half-Century
Are Corporations in Canada Paying Their Dues? Evidence of Taxes Collected over the Last Half-Century
Business and Household Indicators
Canadian Economic Analysis
Pages:25 pages40 min read
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Taxes on corporations have been constantly increasing in nominal as well as in real terms.
Over the last 50 years,
- total corporate taxes have increased by more than nine times in real terms, resulting in an annual average compound growth of 4.6 per cent.
- the most significant increase has been in payroll, property and other miscellaneous taxes.
- the distributional share between federal and provincial governments have completely reversed. Provincial governments now take 61 per cent of total taxes collected from corporations compared to 39 per cent in 1950.
- the proportion of corporate taxes to the GDP was 9.2 per cent in 1960; that increased to 13.2 per cent in 1999.
The empirical evidence is clear. Given the increase in corporate taxes over the past 50 years, and their 4 per cent rise as share of GDP, Canadian corporations are certainly paying their tax dues. Payments may even amount to more than what could be sustained in terms of global competitive pressure, especially from the United States.
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