Opinion: Ignore Ottawa’s rhetoric. High-income earners already pay more tax

financialpost.com:

By Jake Fuss and Grady Munro

With its recent focus on “fairness,” the Trudeau government has reignited the debate around whether high-income earners pay their “fair share” of taxes. Our new study, published by the Fraser Institute, sheds light on this ill-defined concept of “fair share.” We find that the top 20 per cent of Canada’s income-earning families already pay disproportionately more taxes than all other income groups.

This year’s federal budget was titled “Fairness for Every Generation.” As in its past budgets, the Trudeau government once again raised taxes on Canadians, this time by increasing the capital gains tax inclusion rate from 50 per cent to 66.7 per cent for all capital gains realized by businesses, and for gains exceeding $250,000 realized by individuals. The stated purpose of this change was to make “the very wealthiest … pay their fair share.”

Despite the government’s class-warfare rhetoric, the capital gains tax change has broad implications for the economy and will raise the taxes paid by many Canadians who wouldn’t normally be considered wealthy. It’s also the latest in a series of tax increases by the Trudeau government aimed at shifting more of the tax burden onto upper-income earners. In each case, starting in its very first budget in 2016, the government has justified the increase by appealing to “fairness.”

But the tax data tell a different story about fairness.

As our study shows, in 2024 the top 20 per cent of income-earning families in Canada will pay 54.2 per cent of all the taxes (income, sales, property, etc.) raised by all three levels of government despite earning 46.4 per cent of total income. In other words, the top fifth of earners will earn less than half the income but pay more