Quebec applies the highest effective personal income-tax rates in Canada, closely followed by Newfoundland & Labrador, Nova Scotia, Prince Edward Island, and New Brunswick. The eastern-most provinces in Canada have higher effective personal income-tax rates than the western-most provinces in most cases examined.
Income tax rates in Quebec are higher than in other provinces and territories because the government of Quebec finances a wide variety of services that other governments do not.
The province with the lowest top marginal tax rate is Saskatchewan, but the territories of Nunavut and Northwest Territories are lower. The following table shows the top marginal tax rates in 2021 by province and territory.
1. Alberta (no sales tax) Alberta is the only province that does not have its own sales tax, relying instead on its oil revenues.
The gap between Alberta and B.C. grows as you approach $75,000. At that point, Albertans pay about $1,200 more in provincial income tax than their neighbours to the west. Around $100,000, Albertans pay less than Ontarians but still more than people in B.C.
Across all four family types, we observe a common finding: Atlantic Canada along with Quebec tend to maintain higher personal income-tax rates while Ontario and western Canada have the lower rates.
The province of Quebec continues to rank as one of the lowest cost of living provinces in Canada. This stems not only from some of the lowest rents in Canada and subsidized child care, but also through Quebec's electricity prices being much lower than the national average, at 7.3 cents per kWh.
Alberta has a long history as a low-tax, high-spending jurisdiction. That equation doesn't sum in the rest of the country, but it does in Alberta, thanks to oil royalties. Oil allowed Alberta governments to tax like conservatives and spend like social democrats.
Alberta's cost of living is generally less than British Columbia. You can make 22% less in monthly income and maintain the same standard of living as you did in Alberta. Entertainment, rent, housing, dining out, and more are all generally less expensive in this province.
The federal government collects personal income taxes on behalf of all provinces and territories. It also collects corporate income taxes on behalf of all provinces and territories except Alberta.
Quebec property tax is relatively low as well compared to New Brunswick which has the highest property taxes in Canada. Property tax rate comparison shows that property taxes in some provinces are more than 2 times that in other provinces.
Canada ranked 21st out of 38 OECD countries in terms of the tax-to-GDP ratio in 2020. In 2020, Canada had a tax-to- GDP ratio of 34.4% compared with the OECD average of 33.5%. In 2019, Canada was also ranked 21st out of the 38 OECD countries in terms of the tax-to-GDP ratio.
The tax rates in Canada are usually higher than in the United States. In Canada, tax revenue makes up 38.4 percent of the GDP, while in the United States, the tax revenue makes up 28.2 percent. This is largely due to the differences in the way each government spends money.
New Brunswick: the Province with the Happiest People!
New Brunswick comes in with the highest RHI at 78.60, followed quite closely by Newfoundland with 78.40.
The safest province in Canada is Quebec since it is home to four of the safest cities in Canada: Levis, Quebec City, Blainville, and Saguenay.
Lower Cost of Living
Almost every aspect of living in Alberta is cheaper than living in Ontario. On average the purchasing power in Ontario is 25% lower than that in Alberta. For starters, the minimum wage in Alberta is $15 per hour whereas the minimum wage in Ontario is 14$.
Soaring real estate prices over the last three years have cost New Brunswick its status as the cheapest province in Canada to buy a house.
The cost of purchasing a home or renting an apartment is lower on the Quebec side. Transportation, health care, utilities, and education costs are all either lower on the Quebec side or equivalent to the costs on the Ontario side.
As you see, the cost of living is cheaper in Gatineau compared to Ottawa.
Quebec City, Quebec
One of the cheapest places to live in Canada, Quebec City ranks as the most affordable of the 15 largest cities in the country with estimated living costs of around 1,600 Canadian Dollars per month.
Nunavut does not have any PST and therefore the total tax rate is only 5% (1).