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Canada is quite similar: In 2006, from $14k up to $88k the combined Federal+BC income taxes, payroll taxes, and sales tax credits worked out to a flat rate of 26% plus or minus $250. (Above $88k the rate goes up, but mostly due to a cap on the amount which can be "hidden" in retirement funds.)

Graduated tax rates plus low-income tax credits equals a flat tax.



Really? Effective US tax rates are about a third higher than Canadian rates?

I find that difficult to believe, but I'd be greatly amused if it was true.


Well, it depends in part on what you include. The 26% I mentioned is for income taxes, payroll taxes, and (income-based) sales tax credits; but Canadians also have to pay a federal sales tax of 5% and provincial sales taxes (typically around 7-8%) on most purchases.

I believe the total tax burden ends up being fairly similar between the US and Canada -- while Canada spends far more (per capita) on social services and health care, the US spends a similarly larger amount on the military.


Canadians also pay much more for gasoline than Americans. Of course, not all of this is in taxes.

To check this: find a "gas buddy" site for a place in Canada, then find one for the nearest US city/town close to it (to control for price disparity due to shipping).

Multiply cost per liter by 3.6 to get equivalent US Gallon; then adjust it by current exchange rate.

Example: lowest for Vancouver, BC: http://www.vancouvergasprices.com/ is currently 106.9 per liter ($1.069 CAD) , times 3.6 = $3.85 CAD , about $3.66 per US Gallon in USD.

Closest city on the US side is Bellingham, WA, lowest price there is $2.82, or about US $ 0.80 difference per gallon.

Assuming a fill-up is 12 gallons, that is ~$10 per tank difference.


Canadians also pay much more for gasoline than Americans. Of course, not all of this is in taxes.

I think most of the difference is taxes -- unlike pretty much everything else, advertised gasoline prices include federal and provincial sales taxes. In Vancouver they also include a carbon tax (currently $0.048/L) and an additional fuel tax to fund mass transit (currently $0.12/L).


American gas prices include all taxes.


I said unlike everything else, not everywhere else. Gasoline is the only thing I can think of in Canada for which the advertised price includes taxes.


I interpreted "I think most of the difference is taxes" as ".ca prices are higher because they include taxes".


Perhaps not advertised as much as gasoline, but at least in NB and NS, the displayed price on alcohol includes all sales taxes, but that's the only other thing I can think of.


At least in Ontario, alcohol has the tax wrapped in the price as well. Well, at least at stores, don't remember about restaurants.


Go down to Seattle and it's probably $2.50. We Bellinghamsters have been getting screwed for years (at least relative to the Seattle metro area).

There's an odd effect where a high-price area spills over into the neighbo(u)ring areas. I haven't quite figured out an explanation.


I wish it was $2.50 in Seattle. I'd even be overjoyed to pay the Bellingham price of $2.82. I paid $3.11 to $3.17 the last two times I filled up last week.


Don't complain. Here in the Netherlands it's around $7.6 per gallon.


$6.31 is Paris at the cheapest ever station that I never heard of because it must be so out of the way. $6.90 seems to be average.

Sure would love me some $3 gas.


There's an odd effect where a high-price area spills over into the neighbo(u)ring areas. I haven't quite figured out an explanation.

Price gouging.


Come down to California some time.


Canadians also appear to pay more for books that Americans. $30 for a hardcover, are you nuts?


I've read that a critical difference between the US and Canadian budgets is that Canada consistently balances its budget while the US does not. In the short term this means that the US can avoid collecting taxes on its full expenses, while Canada has to collect expenses in full. In the long run the tax implication should reverse.


When I was looking for work after University I was astonished to find that I would be pay much more taxes in Texas than I would in Ontario. I would still have had a better standard of living though because housing is so much cheaper there and the wages are about 15% higher, but still, it was sobering. One point the original poster forgot to include was that you do eventually have to pay taxes on your RRSP contributions, so it is just tax delayed, not really less taxes. One reason I don't contribute to my RRSP is that I think taxes are going to go well north of where they are today due to the baby boomer strain on social services. Better to take it out now than later.


The US is less competitive than it likes to believe in the tax wars, when all is included. We just spend an incomparable amount on military instead of social services.


I moved from a job in Canada to a job in the USA with a similar salary in the US. The deductions from my paycheck were noticeably higher. Sales tax was slightly lower.


Well we do pay double per capita what Canada pays for healthcare, so it wouldn't surprise me at all.


That surely can't be for premiums? I remember paying $95/month for full coverage ($179 for a family?) with low (no?) deductible when I lived in BC.

I wish, WISH, for that kind of coverage here in CA. I've got catastrophic coverage only for like $200/month.


MSP is only in BC. The rest of the provinces just include it in their tax base and don't do the entire unnecessary exercise of an MSP bill.


I'm talking about per capita public money spent on healthcare by the government.




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