Hennessy’s Index: March 2014

Tax Cuts 101

Hennessy's Index

Hennessy’s Index is a monthly listing of numbers, written by the CCPA's Trish Hennessy, about Canada and its place in the world. For other months, visit: http://policyalternatives.ca/index

  • 70 years

The last time Canadian federal tax revenues have been this low (as a share of the economy). [Source

  • 29%

Top federal personal income tax rate for anyone earning from $136,270 to you name it. In 1981, the rate for anyone earning $119,000 or more (1981 dollars) was 43 per cent. [Source] 

  • $2.5 billion

Estimated additional revenue that could accrue to federal fiscal coffers in 2015 if the federal government adopted a new tax bracket of 35 per cent for incomes over $250,000. [Source]

  • $6 billion

Eventual annual loss in revenue the Alternative Federal Budget estimates could result from the federal government’s 2011proposal to double the limit for Canadians who can afford to shelter money into the Tax Free Savings Account, which now has an annual limit of $5,500 a year. [Source]

  • 29.1%

Canada’s federal corporate income tax rate in 2000. By 2011 that tax rate had been cut in half, to 15%. [Source

  • $6.1 billion

Estimated loss in annual revenue when the federal government cut the corporate income tax rate from 18.5 per cent in 2011 to 15 per cent. That represents a $1.75 billion revenue loss for every percentage point decrease. [Source

  • 5 times more

Every dollar spent on public services or invested in public infrastructure generates an average of five times more jobs and immediate economic activity as a dollar lost to corporate tax cuts. [Source

  • $9.8 billion

Estimated annual new revenue that could be generated if Canada’s federal corporate tax rate was restored to 22 per cent (the 2006 rate was 22.1 per cent). [Source

  • $1 billion

Estimated average new revenue that would go into federal fiscal coffers if the corporate income tax rate on the oil, gas and minerals sector was restored to the 2002 rate of 28 per cent. [Source

  • $1.75 billion

Estimated annual new revenue that could be generated if the federal government increased the small business tax rate from 11 per cent to 15 per cent. [Source] 

  • $8.4 billion

New net revenue expected from treating capital gains income as you would employment income, adjusting for inflation, behavioral and other factors. [Source

  • $280 billion

Estimated public revenue lost worldwide from the $20 to $30 trillion in cash sheltered through tax avoidance (popularly known as tax havens). Canada loses up to $10 billion a year on this gaping loophole. [Source]

March 1, 2014