By Rob Starr, Content Manager, Big4.com
Top personal income taxes around the world have increased by an average of 0.3 percent in 2012, according to a new study from KPMG. Top tax rates have seen varied movement since the study’s inception – from 2003 to 2009, top tax rates gradually declined, and began increasing again in 2010, sparked by deficit concerns. In 2011, top tax rates remained in a holding pattern, and have since increased in 2012.
Of the 114 countries studied, Canada was one of many to introduce new tax bands for high income earners. In particular, Ontario’s recently announced tax increase for high income earners contributed to Canada making the list of locations that introduced additional tax bands for its highest earners in 2012.
When it comes to Canada’s neighbours to the south, there were no changes to top federal rates in the US in 2012. However, US tax cuts are once again scheduled to expire at year’s end, and if on schedule, would see top US Federal tax rates increase from 35 percent to 39.6 in 2013.
The survey also compares the amount of tax an individual will generally pay on income equal to US $100,000 when provincial and state income tax and social security taxes are taken into account. Of the 114 countries studies, Canada ranks 40th from the top, with a tax burden lower than some European countries, but higher than the US.