TAX FACTS: Facts and Figures for the Battle Against Tax Cuts: Income Taxes: Who Pays What?

Income Taxes: Who Pays What?

TAX FACT: Tax cuts cannot produce a significant improvement in the standard of living of low-income Canadians, for the simple reason that low-income people hardly pay any taxes. Even for middle-income earners, tax cuts won't make much difference.

Sixty percent of Canadians earn less than $25,000 in a year. This majority of Canadians hardly pays any income tax at all - barely 5 percent of their income. Even eliminating their taxes altogether won't make a measurable difference to their quality of life. But more cutbacks to social programs, which will inevitably result from tax cuts, will hurt them badly. Even middle-income Canadians only pay about 20 percent in income taxes, after deductions and exemptions. For them, tax cuts will only marginally enhance their disposable income, while putting important public services (like Medicare) at risk.

Source: CAW Research from Canada Customs & Revenue Agency, "Income Tax Statistics on Individuals."

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