Steve_P

You might want to get your facts straight.

GST and PST are not payable on children's clothing and basic food items in Canada either. Books and magazines yes.

bats

5% GST or HST

Steve_P

Or GST and PST in provinces that haven't gone the HST route. Or just 5% GST in Alberta.

Steve_

Mmm, but that's very misleading and you've fallen for the con perpetrated by the UK Govt. whenever income tax rates are compared.

Payroll taxes (i.e. NI) are fantastically higher in the UK than in Canada. Class 1 is 12% between the "primary threshold" of £7,592 and £42,484, and there's another 2% above that. In Canada CPP is 4.95% up to $51,200 (roughly £32,000).

Payroll taxes are the primary "stealth" tax that people are always complaining about.

Also on GST/HST - I always think this is pretty much the same thing as VAT, the GST guide appears to be copied from the HMRC VAT guide, AFAIK the only major difference other than the rate is that bank services are not zero-rated in Canada, they're exempt (which was a mistake the banks lobbied for).

bats

But not zero whatever you call it as the federal tax is 5%

Steve_

And you moved to Alberta, where the taxes are actually higher!

At least up to $100,000 or so of income, depending on what credits you claim.

Alberta doesn't have the lowest income taxes in Canada, this is a myth, BC does because of Alberta's stupid flat tax.

This is one of my pet peeves with Alberta, because the unions are always calling (rightly) for the minimum wage to be increased and the govt is always moaning about there not being enough labour in the lower paid sectors.

Well, BC has lower taxes on those people and a higher minimum wage, so why would you move to Alberta?

I always laugh when I see Americans pointing to the "success" of Alberta's flat tax. Has to be the primary example of the idea failing, imo. Rich people get richer, middle class on down are worse off, discourages labour.

Almost Canadian

I wasn't complaining about the tax rates of any jurisdiction

MikeUK

Last time I worked out the total income taxes

I got 30.73% for Ontario and 30.88% for the UK

I included stuff like CPP & Employment Ins as well as National Insurance

When you think about how you file for a tax return here and the UK PAYE system what you get in interest if the money was in your bank and not with the government I’d call it a wash

What I do think is relevant is how those taxes are spent and there I think theUK does a better job

Steve_P

Yes zero on basic food items.

There is "NO GST" on those items.

Shard

NI is not 12% of income, more like 2-3% of income, and I think it is capped too. As MikeUK says if you do the calculation you will see that personal tax rates are broadly similar.

jimf

Is $100k your threshold for being rich in Alberta?

scrubbedexpat091

But in Alberta the min. wage actually goes up and doesn't stay stagnant for a decade.

September first its going up 20 cents, so will only be 30 cents/hr less then BC, and will probably surpass BC at some point, our politicians don't have a very good record of raising it, probably be another 10 years before we see an increase here.

You are also less likely to make min. wage in Alberta, of all provinces, Alberta has the least amount of min. wage workers.

I would trade Alberta for BC in a second despite the flat tax, overall benefits, higher wages, lower overall cost of living compared to Vancouver and the lower mainland, no PST, no medical services premiums etc.

montreal mike

The last time I was in England and that was in 1999 i found that a pound over there was about a dollar over here, disregarding the exchange rate

I was astonished at the astronomical high rents in the London area

My contention is that comparing tax rates is only one part of the equation

What i find more to the point is what someone over there, be it blue collar or middle class, would earn as compared to Canada and how far the money goes in the UK was compared to Canada?

From a strictly monetary POV where would one be better off?

IOW what is the purchasing power of take home pay?

Is there even an answer to this question?

Steve_

Oops yes, NI has always confused me with all the different classes but anyway taxes are definitely lower in Canada, certainly in Alberta they are.

The top rate in Alberta is only 39%, in the UK it's 50%. The 40% tax bracket in the UK kicks in at £35,001 which is around $56,000. In Alberta you're only at the 32% rate at that amount of income. The 39% rate in Alberta doesn't kick in until $135,054 (i.e. more than twice the amount for the UK 40% rate). You never even reach 40% let alone 50%.

And that doesn't even include say, GST being 5% compared to VAT at 20%, lower capital gains taxes, lower fuel taxes, lower car tax, no estate/gift tax, etc. Plus you've also got the dividend tax credit. No question taxes are lower here.

They are not "broadly similar".

Ontario is also lower but not as low as Alberta. At $56,000 of income you're in the 31.15% bracket and you don't hit 40% until you're over $82,000 and change. And HST is lower than VAT, etc.

Shard

Top rate in the UK is currently 45%, not 50%. Have a look at the third column, which applies to the current tax year...

http://www.hmrc.gov.uk/rates/it.htm#2