Are Quebecers paying too much tax?

This text is taken from the Courrier de l’économie of October 10, 2022. To subscribe,Click here.


A majority of Quebecers believe they pay too much tax. One could logically believe that it is because they are actually more taxed than elsewhere, but that would be too simple.

The Chair in Taxation and Public Finance at the University of Sherbrooke released the results of a survey on Friday reporting that 53% of Quebecers believe they pay too much tax, even taking into account the government programs and services they receive. in exchange. As almost everyone else (45%) considers doing their fair share, this leaves less than 2% who think they could do more.

It must be said that Quebec is one of the places in the developed world where taxes are the highest, with a total tax burden equivalent to almost 39% of its gross domestic product (GDP), against an average of 33.5% in OECD countries.

However, it is necessary to go beyond the averages, the feeling of paying too much tax being stronger in Quebec among those who earn $100,000 and more per year (59%) than among those who earn less than $40,000 ( 44%). Or among those who have a job (63%) than those who are studying (38%) or retired (41%). Normal, one would be led to conclude, since these people are also those who are objectively led to pay the most taxes.

It is true that not everyone pays as much tax and does not receive as many services and transfers from governments. When we only consider the net tax burden (tax — transfers), we see how, in this regard, Quebec is almost a paradise among OECD countries for low-income households and those with children. , but how this is no longer the case when you have no children or a high income.

Another study by the Chair of the University of Sherbrooke illustrated well, two years ago, how Quebecers generally pay more money to their governments than they receive in transfers and public services in return during their working life. . However, this imbalance is reversed during their studies, but even more so after their retirement, to the point of concluding in their favor if they live long enough.

The management of the government is debated

But the fact of objectively paying more taxes is not the only factor involved in the feeling of many Quebecers to do more than their share. In fact, there is an even more important one, reported the Chair in another study, in 2018 this one, that is to say the impression that governments mismanage their money.

It was revealed that 70% of Quebecers believe that their taxes are “rather badly” (48%), even “very badly” (22%) “administered and spent by the government”, compared to less than a third who think that this is does “fairly well” (27%) and even “very well” (3%). This mismanagement was attributed in particular to “the corruption of civil servants and politicians”, the problem of tax evasion or simply unnecessary expenditure. In some groups, the proportion of people believing they paid too much tax could jump from 37% to 66% or from 45% to 73% if they thought that public funds were well or badly managed.

It is interesting to observe that on the international scene, there also does not seem to be a direct link between the level of the tax burden and the feeling of taxpayers to get their money’s worth. In Friday’s Chair study, we find, for example, that in countries such as Denmark and Belgium, which are among the most heavily taxed in the OECD, the proportion of the population who believe they give too much to the state for what it receives is among the lowest. We also see the opposite happening with countries like Chile and Mexico, where taxes are among the lowest and frustration the highest.

Moreover, it is not because a majority of Quebecers consider themselves overtaxed that they would not be ready to do even more for the right reasons, tells us the chair of the University of Sherbrooke. Nearly two-thirds of Quebecers would therefore be very or somewhat in favor of an increase in the QST if it were to benefit health. This proportion exceeds 58% for education and 55% for the fight against poverty. We flirt with 58% when it comes to obtaining in exchange a reduction in personal income taxes, but we fall around 40% if it is to go to debt reduction or tax reduction on employers’ payroll.

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