Finance ministers, in Canada as elsewhere, are generally very concerned about the impact of their tax policy on the wealthy. They want their country to remain competitive, so as not to cause exoduses.
On this subject, a recent report is very useful to have an overview of the migratory movements of the rich, in particular the impact of reasons other than fiscal ones, such as political stakes. The report was produced by Henley & Partners, London. This firm, which has about thirty offices spread all over the world, advises wealthy individuals when changing country of residence.
Unsurprisingly, China lost the most millionaires in 2022 (10,800), followed by Russia (8,500), amid the war in Ukraine, according to the report. In 2023, the firm expects departures from Russia to fall to 3,000, while they will be 13,500 in China.
Among Western countries, this gap between inflows and outflows of wealthy people will particularly affect the UK this year. The Brexit country will have a net outflow of 3,200 wealthy people in 2023, the report predicts, after 2022’s 1,600. High net worth people are defined as those with wealth of more than US$1 million.
More millionaires in Canada
Australia and Canada rank well in this portrait. Despite a relatively modest population, these two countries should have a net inflow of 5,200 and 1,600 new rich in 2023, an increase of more than 30% compared to 2022.
In comparison, the United States is expected to welcome 2,100 more rich people in 2023, and France, 1,000. The United Arab Emirates stands out, with the reception of 4,500 millionaires in 2023.
According to Henley & Partners, the total number of millionaires who change countries has increased steadily over the past 10 years, from 51,000 in 2013 to 84,000 in 2022. This figure could reach 122,000 people in 2023, the firm predicts.
In its press release, Henley & Partners maintains that “political stability is the key measure for those who choose where they want to live, with low tax regimes and personal freedom”. Upcoming elections in the UK and the US could be key to the choice of some millionaires, according to the report.
The misery of the rich, what…
Construction and the wage boom
It is well known that wages in the construction industry rose during the pandemic in Quebec, in the context of the scarcity of labour, among other things. But what do the rises in plumbers, carpenters and other trades look like and how do they compare to the rest of Canada?
Statistics Canada released data on Friday that shed some light on the matter.
For the past five years, it is in Quebec that the remuneration of union members has increased the most in the five main regions of Canada. The rise is sometimes much more imposing than elsewhere.
Thus, carpenters, joiners or electricians have all had increases of more than 11% over the past five years, compared to just over 6% in Ontario and less than 3% in the Prairies. Among the five trades that I analyzed, laborers saw their pay increase the most in Quebec (13.7%), according to Statistics Canada data.
That said, even with a greater increase, hourly rates in Quebec have not necessarily reached those of the other provinces, particularly Ontario.
According to Statistics Canada, the hourly wage of a unionized electrician in Montreal ($60) is similar to that offered in Halifax, Nova Scotia, or Calgary. It is, however, significantly lower than that in Toronto ($70), at the peak. Similar observation for plumbers.
On the other hand, painters earn more in Montreal ($55 per hour) than in Calgary or Vancouver ($52).
Please note that the hourly rates used for the calculation correspond to the basic remuneration including certain social benefits of unionized workers (paid holidays, paid public holidays, contributions to pension plans, etc.). They do not necessarily represent the rate that small contractors charge for residential work, which also includes a range of other fees, in addition to the profit margin.
These Statistics Canada data, moreover, do not allow us to measure the impact of rather stringent regulations in Quebec on construction costs.
