Do top earners in Canada pay their 'fair share' of taxes?

Today Statistics Canada (StatsCan) released its annual data examining trends among top earners in Canada, drawing data from tax-filing records.

There are many notable takeaways from the new data. For instance, a reoccurring narrative in the income inequality debate is that top earners don’t pay their “fair share” of taxes. However, the data released by StatsCan paint a different picture. Indeed, the top one per cent pays a higher share of income taxes than the share of income they earn. Specifically, in 2013, the top one per cent of tax-filers earned 10.3 per cent of the nation’s total income but paid 20.3 per cent of federal/provincial/territorial income taxes.

But that of course is just income taxes.

Canadians pay a wide range of other taxes—some visible, many hidden—including payroll taxes, health taxes, sales taxes, property taxes, fuel taxes, vehicle taxes, profit taxes, import taxes, “sin” taxes on liquor and tobacco, and much more. When we account for all these taxes, only the top 20 per cent of income-earning families in Canada pay proportionately more in total taxes than what they earn in income. This is illustrated in the chart below by the group’s larger red bar (share of total taxes) compared to the smaller blue bar (share of total income).