In the midst of the Quebec election campaign, the focus on the increasing cost of living has brought attention to the assertion that Quebec bears the highest tax burden in North America. Éric Duhaime, leader of the Conservative Party of Quebec, is leveraging this claim to support his pledge of substantial cuts to income and corporate taxes as a solution to address the cost of living challenges.
Duhaime emphasized the burden faced by Quebecers, stating that the province carries the highest tax load in North America. He reiterated this stance during a news conference, highlighting Quebec as the most heavily taxed jurisdiction among 60 states and provinces in Canada and the U.S.
Analyzing the validity of this assertion, experts delve into various measures of the tax burden. Luc Godbout, a professor at the Université de Sherbrooke specializing in taxation and public finance, explains that one way to assess this is through the “overall tax burden.” Quebec indeed ranks highest among all Canadian provinces, with its taxes accounting for 38.6% of the GDP in 2024, surpassing the U.S. and Mexico.
Examining the individual tax level, Quebec’s gross individual tax burden is only exceeded by Nova Scotia. However, when factoring in refundable tax credits and direct family allowances, Quebec’s net tax burden is lighter than four other provinces, including Nova Scotia.
Despite higher taxes for high-income earners without children in Quebec, the tax system substantially reduces income inequality. Through government transfers, Quebec achieves some of the lowest income inequality levels in the country.
Colin Pratte, a researcher at the Institut de recherche et d’informations socioéconomiques (IRIS), argues that Quebec’s higher tax collection plays a crucial role in redistributing wealth effectively. Statistics Canada data indicates a lower poverty rate in Quebec compared to Ontario, attributing this disparity to Quebec’s tax system.
While Duhaime’s narrative resonates with corporations and high-income individuals, the redistribution of wealth through government transfers translates to lower-income families facing comparatively lighter net tax burdens in Quebec.
The ongoing Quebec election campaign reflects a nuanced discussion on tax policies and their impact on the economy and society.
