Payroll Taxes in Canada from 1997 to 2007

Transcription

1 Payroll Taxes in Canada from 1997 to 2007 This paper describes the changes in the structure of payroll taxes in Canada and the provinces during the period We report the average payroll tax per employee, the ratio of payroll tax revenues to GDP and to total government revenues, the composition of payroll tax revenues, and the effective payroll tax rate. The stability of the national effective payroll tax rate, as well as payroll taxes as shares of GDP or of government revenues, during the decade masks substantial changes in the composition of payroll taxes and large differences across provinces. C/QPP contributions overtook EI premiums as the largest source of payroll taxes in Among the provinces, Quebec has the highest effective payroll tax rate and Alberta the lowest. Payroll taxes across countries in 2007 are also compared using OECD data. JEL:H20 H24 Keywords: payroll taxes; EI premium; C/QPP premium; workers compensation premiums; provincial payroll taxes; effective payroll tax rates 1

2 I. Introduction Payroll taxes can be defined as levies on businesses commensurate with the size of their payrolls. Furthermore, payroll taxes are usually used to finance social insurance programs and part of a payroll tax may also be levied on employee earnings. These taxes constitute major sources of government revenue in Canada, raising $78.5 billion in 2007 or 13.6 percent of total federal and provincial revenues. Payroll taxes feature prominently in policy debates, because of their potential adverse impact on wages and employment, as well as on investment and entrepreneurship. 1 Beach, Picot, and Lin (1996) together with the update in Lin (2001) describe the structure and evolution of payroll taxes from 1961 to This period precedes the acceleration of contribution rate increases associated with the 1998 reforms to the Canada Pension Plan, and the steady declines in Employment Insurance premiums since the mid 1990s in line with the rate setting procedure prescribed by the Employment Insurance Act of Hence, it seems opportune to examine the trends in payroll taxes for the subsequent decade. This paper uses the same methodology as the previous authors to characterize, for Canada and the provinces over the period , the average payroll tax per employee, the ratios of payroll taxes to GDP and to federal and provincial government revenues, the effective payroll tax rates, and the composition of payroll taxes. We also compare payroll taxes across countries in 2007 using OECD data. We find that Canada/Quebec Pension Plan contributions (C/QPP) have replaced Employment Insurance (EI) premiums as the largest component of payroll taxes since 1999, and in 2007 C/QPP premiums account for 53 percent of total payroll taxes in Canada, compared to only 23 percent for EI premiums. This development reflects the very rapid growth in the C/QPP contributions during the period 1997 to 2003 and the continuous decline in the EI component. The 1 See Kesselman (1994) for a discussion of the economic issues. 2

3 changes in C/QPP contributions and EI premiums have, however, been approximately offsetting, resulting in stable ratios of payroll taxes as a percentage of GDP and payroll taxes as a share of federal and provincial government revenues throughout the period The overall effective payroll tax rate has been about $12 for every $100 of wages and salaries in each year. These trends are in contrast to Lin s (2001) findings for trends in the pre-1998 period, where payroll taxes increased substantially and almost continuously between 1980 and 1997 and EI premiums were the largest component except in In fact, over the decade the national effective payroll tax rate increased by 3.34 percentage points and averaged percent. Over the more recent decade of the national effective payroll tax rate decreased by 0.67 percentage points and averaged percent. Finally, despite the overall stability in payroll tax financial ratios, there has been a marked increase in (inflation-adjusted) average payroll taxes per employee in Canada since This must reflect increases in productivity, which reduced the growth in the workforce relative to increases in GDP. Section 2 describes the statutory payroll tax rates from 1997 to Section 3 explains the data sources used for our calculations of the effective payroll tax rates and for the other descriptive ratios. Section 4 reports our findings on the payroll tax trends in Canada and in each province. Section 5 provides an international comparison for the year Section 6 summarizes and concludes. An appendix provides our data and the descriptive ratios for each year and province. We provide the data for the extended period of to facilitate researchers. 2 The appendix also gives the CANSIM table numbers for variables used in the analysis. 2 For the pre-1998 years our data is identical with Lin (2001), with a few exceptions attributable to revisions of the data by Statistics Canada. 3

4 II. Statutory Payroll Tax Rates There are currently eight payroll taxes in Canada (as we have defined them) and these have existed throughout our period of investigation. They are the Employment Insurance (EI) premiums and the Canada/Quebec Pension Plan (C/QPP) contributions both charged by the federal government; the Workers Compensation (WC) premiums levied by all the provinces and territories and administered by Workers Compensation Boards; the Health and Education (H/E) taxes in Newfoundland and Labrador, Quebec, Ontario, and Manitoba; and the employer contributions to vocational training in Quebec. The federal taxes are levied on both employers and employees, while all of the other taxes are levied only on employers. Finally, the Northwest Territories and Nunavut refer to their taxes on employment earnings as payroll taxes, but for our purposes these taxes resemble personal income taxes. 3 As in Lin (2001), we include only the 10 provinces, excluding the territories, in our totals for Canada. Tables 1 and 2 summarize the EI and CPP contribution rates and the maximum contribution amounts from 1997 to These rates have changed substantially over the period, as total EI premium rates fell every year and total CPP contribution rates rose each year from 1997 until Table 3 provides the 2007 payroll tax rates levied by the provinces. These rates remained almost the same since 1997, although the thresholds at which the various rates apply have occasionally been changed. III. Data Sources The supplementary labour income (SLI) database of Statistics Canada provides the data on employer EI premiums and C/QPP contributions. The employee portions and the total EI and C/QPP payroll taxes are calculated by applying the 3 The intent of the NWT and Nunavut tax is to collect revenues on the earnings of non-residents. 4

5 Table 1 EI contribution rates and the maximum contribution amounts (curent dollars) Year EI premiums per $100 of insurable earnings Maximum annual contribution Employee Employer Total Employee Employer Total Table 2 CPP contribution rates and the maximum contribution amounts (curent dollars) Year CPP rate on pensionable earnings Maximum annual contribution Employee Employer Total Employee Employer Total

6 Table 3 Provincial Health and Education Payroll Taxes in 2007 (and 2008) Province Tax Rate Structure (Name of Tax) (Base: Payroll) Newfoundland 2% payroll >$1 million (Health and Post-Secondary Education Tax) Quebec 4.26% payroll > $5 million (Health Services Fund) 2.7% to 4.6% a $1 million <payroll $5 million 2.7% payroll $1 million Manitoba 2.15% b payroll > $2.5 million (Health and Post-Secondary Education Tax Levy) 4.3% c $1.25 million payroll $2.5 million Ontario 1.95% d payroll > $400,000 (Employer Health Tax) Quebec 1% payroll > $1 million (Employer Contributions to Vocational Training) a The rate was 4.26% on payrolls regardless of size in b The rate was 2.25% in c The first $1.25 million of the payroll is exempt. The rate was 4.5% in d The rate ranged between 0.98% and 1.95% in 1997, depending on payroll size. fixed ratios of employer-to-employee taxes implied by legislation. 4 Data on workers compensation premiums are also provided by the SLI. Provincial accounts are the source of data on Health/ Post-Secondary Education Tax for Quebec, Manitoba, Ontario and Newfoundland. The CANSIM database of Statistics Canada provides the data on Gross Domestic Product, Federal and Provincial government revenues, the GDP implicit price index, wages and salaries of employees, and the total number of full-time employees for each province and Canada as a whole. 4 Employer EI premium are equal to 1.4 times employee EI premiums and employer C/QPP contributions are equal to the employee C/QPP contributions in every year, as reflected in tables 1 and 2. 6

7 IV. Trends in Recent Years This section reports the payroll tax trends from 1997 to 2007 for Canada and for each province. A. Average Payroll Taxes per Employee Figure 1 shows that there has been a large increase in the national average payroll tax per employee from $3,487 in 1997 to $5,685 in 2007 (expressed in 2007 dollars). The tax per employee remains highest in Quebec, at $6,913 per employee in 2007; the lowest is in Saskatchewan, at $4,390 per employee. The increases in payroll taxes per employee primarily reflect changes in the denominator of the ratio. That is, as will be clear in a moment, the growth in the number of employees in Canada is lower than the growth in GDP, presumably reflecting increases in productivity. $7,000 $6, $5,000 $4,000 $3,000 $2,000 $1,000 $0 Figure 1. Average payroll taxes per employee (2007 dollars) B. Payroll Taxes as Percentage of GDP Despite the rapid growth in payroll taxes per employee, Figure 2 shows that payroll taxes as a proportion of GDP decreased slightly for Canada between 1997 and 2007, and only Prince Edward Island and New Brunswick experienced increases. In 2007, total payroll taxes equalled 5.1 percent of GDP for Canada. 7

8 8% 7% % 5% 4% 3% 2% 1% 0% Figure 2. Payroll taxes as a percentage of GDP C. Payroll Taxes as Share of Government Revenues As illustrated in Figure 3, payroll taxes account for 13.6 percent of total government revenues in Canada in 2007, down slightly from 14.0 percent in There are significant differences across provinces. In 2007, revenues collected from payroll taxes accounted for 27.1 percent of government revenues in Ontario and 25.3 percent in Quebec, compared to the low of 14.2 percent in Newfoundland. From 1997 to 2007, payroll taxes became slightly more important revenue sources in Prince Edward Island, New Brunswick and Alberta, but became relatively less important in the other provinces. 5 Figure 3: Payroll Taxes as a Share of Federal and Provincial Government Revenues, 1997 and % % % 20% 15% 10% 5% 0% Figure 3. payroll taxes as a share of government revenue 5 For each province, provincial government revenue is used as the denominator, while for Canada as a whole, combined federal and provincial revenue is used as the denominator. 8

9 D. The Effective Payroll Tax Rate The effective payroll tax rate is the ratio of total payroll taxes to the tax base, which is composed of the full range of federally taxable personal earnings such as wages, salaries, overtime compensation, vacation pay, commissions, performance bonuses, and fringe benefits except employers contributions to employees private pension plans. For the country as a whole, the total effective payroll tax rate was percent in 2007 compared to percent in Braodly speaking the national effective payroll tax rate has been quite stable around 12 percent over the period This contrasts with a large increases in the national effective tax rate in the three previous decades, as reported in Lin (2001). Decompositions of effective payroll tax rates across components as well as across provinces are provided below. Differentials across Components Figure 4 illustrates clearly the dramatic change in the composition of the federal payroll tax structure. The EI effective tax rate decreased steadily from 4.98 percent in 1997 to 2.58 percent in 2007; the C/QPP effective rate increased from 3.92 percent in 1997 to 6.26 percent in 2003, before falling gradually to reach 6.02 percent in The H/E/Training tax is the third largest component of payroll taxes (overtaking WC in 1996) at 1.48 percent in Total Effective Payroll Tax Rate Percent 8 6 C/QPP 4 EI 2 H/E/T WC Figure 4. effective payroll tax rate by component 9

10 Figure 5 shows the distribution of payroll taxes across the sources in C/QPP accounts for 53 percent of total payroll tax revenues (and hence the national effective tax rate) in 2007, with EI, H/E/T and WC accounting for 23 percent, 13 percent and 12 percent respectively. EI 22.6% H/E/T 13.0% WC 11.6% C/QPP 52.8% Figure 5. distribution of payroll taxes among components Differentials among provinces Figure 6 depicts the overall effective tax rate in each province from 1997 to Quebec has experienced the highest effective payroll tax rate among the 10 provinces in Canada, with the tax rate over 15 percent each year. In 2007, the second highest tax rate was in Newfoundland at percent, followed by Prince Edward Island at percent and Manitoba at percent. Ever since 1997, Alberta has been the province with the lowest effective payroll tax rate, at 7.66 percent of wages and salaries in From 1997 to 2007, New Brunswick experienced the largest growth in the effec- 10

11 tive payroll tax rate, which increased by 5.5 percent; next is Prince Edward Island with an increase of 2.6 percent. Alberta has the largest decrease at 11.4 percent, with the remaining provinces decreasing at rates ranging from 2.8 percent to 7.0 percent. E. International Comparisons of Payroll Taxes Tax structures vary considerably across countries. According to OECD data, Canada relies comparatively little on payroll taxes as a source of government revenue. Table 4 shows that in 2007 Canada ranked 25 out of 30 OECD countries in descending order of importance of payroll taxes as a percentage of total tax revenues. Among the G7 countries, France, Germany, and Japan had the highest ratio of payroll taxes to total tax revenues in 2007, at 39.8 percent, 36.6 percent, and 36.4 percent, respectively, compared to 16.4 percent in Canada and an OECD median rate of about 29 percent. Among the 28 countries that use payroll taxes and for which data is available in 1997, only 12 out of 28 had an increase in the share of payroll taxes in total tax revenues between 1997 and 2007, with Canada among them. As a proportion of GDP in 2007 payroll taxes in Canada were 5.5 percent, 23rd on the list in Table 5. Among the G7 countries, France and Germany had the highest ratio of payroll taxes to GDP in 2007, at 17.3 percent and 13.2 percent, respectively, while the rate in Japan was somewhat lower, at 10.3 percent. V. Conclusion Payroll taxes per employee in 2007 are much greater than they were in 1997 (in constant 2007 dollars) for Canada as a whole. But payroll taxes as a percentage of GDP declined steadily but slightly after 2003 to reach 5.1 percent in 2007, compared to 5.5 percent in Similarly, payroll taxes as a share of federal and provincial government revenues trended downward gently after 2003 and are lower in 2007 than in Broadly speaking, however, the national effective payroll tax 11

12 Canada 15 Newfoundland Percent Percent Prince Edward Island New Brunswick 15 Quebec Percent 9 Nova Scotia Percent 9 Ontario Manitoba British Columbia Percent 9 6 Saskatchewan Percent 9 6 Alberta Figure 6. Effective Total Payroll Tax Rates,

13 Table 4 Payroll Taxes as a Percentage of Total Tax Revenue in OECD Countries, Selected Years, rank in 2007 Australia Austria Belgium Canada Czech Republic n.a Denmark Finland France Germany Greece Hungary n.a Iceland Ireland Italy Japan Korea Luxembourg Mexico Netherlands New Zealand Norway Poland n.a Portugal Slovak Republic n.a. n.a Spain Sweden Switzerland Turkey United Kingdom United States Source: Calculations by the authors using OECD Revenue Statistics of OECD Member Countries Database, Comparative tables Vol 2009 release 01 13

14 Table 5 Payroll Taxes as a Percentage of GDP in OECD Countries, Selected Years, rank in 2007 Australia Austria Belgium Canada Czech Republic n.a Denmark Finland France Germany Greece Hungary n.a Iceland Ireland Italy Japan Korea Luxembourg Mexico Netherlands New Zealand Norway Poland n.a Portugal Slovak Republic n.a. n.a Spain Sweden Switzerland Turkey United Kingdom United States Source: Calculations by the authors using OECD Revenue Statistics of OECD Member Countries Database, Comparative tables Vol 2009 release 01 14

15 rate has been quite stable during the period in a close neighbourhood of 12 percent of wages and salaries, in contrast to the large increases in the effective payroll tax rate during the previous decades. The relative stability in payroll tax ratios masks a dramatic change in the composition of payroll taxes. Since 1999, C/QPP contributions have replaced EI premiums as the largest component of payroll taxes. The effective C/QPP tax rate increased from 1997 to 2003, while the effective EI tax rate decreased in every year from 1998 to As in Lin (2001), our recent data also shows considerable variations in the structure, level, and growth of payroll taxes among the provinces. From an international perspective, Canada relies comparatively little on payroll taxes as a source of tax revenues. Finally, given the current economic crisis, it can be expected that the downward trend in the effective EI tax rate is likely to be reversed in the post-2007 period and that there will be at least temporary increases in all of the payroll tax ratios. REFERENCES [1] Kesselman, J. (1994), Canadian Provincial Payroll Taxation: A structural and Policy Analysis, Canadian Tax Journal, 42 (1): [2] Lin, Z., G. Picot and C. Beach (1996), What Has Happened to Payroll Taxes in Canada over the Last Three Decades?, Canadian Tax Journal, 44(4): [3] Lin. Z. (2001), Payroll Taxes in Canada Revisited: Structure, Statutory Parameters, and Recent Trends, Statistics Canada No. 11F0019MPE No [4] OECD, OECD Revenue Statistics of OECD Member Countries Database, Comparative tables Vol 2009 release 01. [5] Treff, K. and D. Ort (2009), Finances of the Nation (Toronto: Canadian Tax Foundation). 15

16 [6] Treff, K. and D.B. Perry, Finances of the Nation, various issues (1997 to 2007). (Toronto: Canadian Tax Foundation). APPENDIX 16

17 Table A.1 : Payroll Taxes by Components, (continued) Thousands of dollars EI 2,959,401 47,630 10,270 87,118 67, ,895 1,138, ,169 90, , ,665 C/QPP 3,397,716 53,878 11,474 96,052 76, ,888 1,277, , , , ,240 WC 1,769,093 15,052 3,572 37,289 26, , ,266 31,388 48, , ,672 H/E 602, ,000 Total 8,728, ,560 25, , ,771 2,746,578 2,985, , , ,373 1,098,577 EI 4,591,250 72,475 15, , ,509 1,141,387 1,762, , , , ,585 C/QPP 3,947,398 61,638 12, ,282 85, ,432 1,483, , , , ,694 WC 2,163,086 20,948 4,092 40,012 32, , ,966 34,137 53, , ,364 H/E 1,275,000 1,275,000 Total 11,976, ,061 31, , ,505 4,073,638 3,896, , ,649 1,169,401 1,464,643 EI 4,658,724 74,199 15, , ,235 1,130,498 1,809, , , , ,915 C/QPP 4,174,432 66,696 13, ,292 92,062 1,001,974 1,593, , , , ,416 WC 2,413,703 22,791 3,891 45,152 35, , ,538 34,683 52, , ,350 H/E 1,392,500 1,337,000 55,500 Total 12,639, ,686 33, , ,166 4,159,912 4,156, , ,086 1,291,065 1,532,681 EI 6,889, ,788 23, , ,296 1,673,628 2,715, , , , ,401 C/QPP 4,475,360 71,394 14, , ,218 1,083,972 1,734, , , , ,080 WC 2,554,717 27,520 4,591 49,190 43, , ,904 38,180 59, , ,551 H/E 1,549,100 1,441, ,100 Total 15,468, ,702 43, , ,401 4,933,761 5,286, , ,295 1,497,125 1,795,032 EI 7,606, ,622 26, , ,267 1,860,254 3,052, , , , ,199 C/QPP 4,961,374 76,846 17, , ,318 1,213,310 1,961, , , , ,514 WC 2,894,343 34,671 4,611 50,904 48, ,932 1,123,786 49,813 63, , ,085 H/E 1,621,100 1,510, ,100 Total 17,083, ,139 48, , ,976 5,310,496 6,136, , ,964 1,556,282 1,924,798 EI 8,531, ,447 29, , ,115 2,074,947 3,461, , , , ,611 C/QPP 5,495,834 82,186 18, , ,302 1,332,882 2,210, , , , ,582 17

18 Table A.1 (continued) Payroll Taxes by Components, (continued) Thousands of dollars WC 3,245,313 37,232 4,956 55,503 53, ,834 1,423,146 69,562 70, , ,219 H/E 1,719,900 1,601, ,900 Total 18,992, ,865 53, , ,098 5,793,663 7,094, , ,294 1,692,214 2,029,412 EI 9,278, ,400 32, , ,614 2,247,487 3,831, , , ,370 1,002,982 C/QPP 6,018,558 87,626 20, , ,850 1,448,318 2,472, , , , ,038 WC 3,769,571 43,350 5,409 62,115 59, ,628 1,738,871 84,530 71, , ,339 H/E 1,955,600 1,829, ,600 Total 21,022, ,376 57, , ,594 6,505,433 8,042, , ,373 1,803,905 2,096,359 EI 10,119, ,671 35, , ,335 2,453,769 4,233, , , ,502 1,098,951 C/QPP 6,751, ,186 23, , ,340 1,637,742 2,810, , , , ,468 WC 4,342,380 50,072 5,694 70,773 68,772 1,233,180 2,123, ,983 80, , ,364 H/E 2,236,500 2,049, ,500 Total 23,449, ,929 64, , ,447 7,373,691 9,167, , ,365 1,864,106 2,172,783 EI 11,076, ,200 38, , ,822 2,693,664 4,658, , ,965 1,026,895 1,207,527 C/QPP 7,630, ,136 26, , ,106 1,848,008 3,199, , , , ,536 WC 5,094,145 64,151 7,665 78,872 74,542 1,473,844 2,410, ,505 93, , ,951 H/E 2,359,200 2,160, ,200 Total 26,160, ,487 72, , ,470 8,175,516 10,267,767 1,014, ,038 2,068,434 2,502,014 EI 9,908, ,254 34, , ,703 2,366,609 4,201, , , ,735 1,114,315 C/QPP 8,637, ,244 29, , ,310 2,052,794 3,652, , , , ,204 WC 5,568,882 70,304 9,074 85,336 82,413 1,567,888 2,636, ,553 91, , ,737 H/E 3,137,300 2,469, , ,300 Total 27,251, ,802 73, , ,426 8,456,291 10,967, , ,462 2,100,630 2,632,256 EI 12,213, ,449 43, , ,220 2,897,695 5,112, , ,509 1,159,845 1,426,910 C/QPP 9,487, ,996 33, , ,098 2,247,110 3,953, , , ,444 1,136,214 WC 5,574,210 84,130 10,793 94,333 89,138 1,486,256 2,595, ,554 97, , ,025 H/E 5,513,300 23,800 2,641,000 2,662, ,500 Total 32,788, ,375 87, , ,456 9,272,061 14,324,047 1,101, ,316 2,501,150 3,114,149 18

19 Table A.1 (continued) Payroll Taxes by Components, (continued) Thousands of dollars EI 14,293, ,677 50, , ,655 3,389,090 5,921, , ,721 1,377,415 1,708,836 C/QPP 10,133, ,532 36, , ,060 2,395,290 4,174, , , ,998 1,244,804 WC 5,353, ,658 11, , ,226 1,256,238 2,505, , , , ,572 H/E 5,638,500 47,800 2,754,000 2,648, ,700 Total 35,418, ,667 98, , ,941 9,794,618 15,249,555 1,205, ,753 2,807,260 3,529,212 EI 17,440, ,611 61, , ,474 4,126,371 7,177, , ,513 1,670,078 2,154,770 C/QPP 10,774, ,642 37, , ,246 2,542,332 4,398, , ,736 1,052,804 1,372,612 WC 5,679,110 98,438 12, , ,405 1,486,342 2,528, , , , ,987 H/E 5,663,000 63,200 2,816,000 2,592, ,800 Total 39,556, , , , ,125 10,971,045 16,696,199 1,352, ,319 3,154,948 4,172,369 EI 17,805, ,637 63, , ,263 4,210,833 7,268, , ,873 1,718,703 2,262,336 C/QPP 11,441, ,022 40, , ,076 2,692,402 4,639, , ,656 1,129,806 1,495,372 WC 5,706, ,967 14, ,098 99,034 1,576,771 2,283, , , , ,100 H/E 5,845,200 67,400 2,917,000 2,670, ,800 Total 40,798, , , , ,373 11,397,006 16,860,580 1,369, ,767 3,376,642 4,486,808 EI 18,848, ,153 67, , ,627 4,455,043 7,660, , ,843 1,813,755 2,453,323 C/QPP 12,221, ,532 43, , ,734 2,885,740 4,925, , ,534 1,205,074 1,632,190 WC 6,079, ,835 13, , ,512 1,683,202 2,351, , , , ,187 H/E 6,010,641 75,000 3,079,000 2,665, ,641 Total 43,161, , , , ,873 12,102,985 17,601,753 1,432, ,190 3,565,780 4,963,700 EI 19,163, ,458 70, , ,978 4,504,298 7,826, , ,819 1,823,211 2,519,499 C/QPP 13,140, ,846 49, , ,338 3,085,504 5,319, , ,882 1,283,366 1,769,026 WC 6,543, ,864 15, ,451 94,490 1,800,846 2,653, , , , ,601 H/E 6,370,550 77,312 3,461,000 2,640, ,238 Total 45,217, , ,570 1,010, ,806 12,851,648 18,439,363 1,490,576 1,016,866 3,556,317 5,273,126 EI 18,405, ,957 71, , ,565 4,344,329 7,445, , ,385 1,776,921 2,440,306 C/QPP 13,863, ,766 54, , ,586 3,244,818 5,585, , ,976 1,375,512 1,887,770 WC 6,422, ,860 17, ,098 91,771 1,772,317 2,610, , , , ,775 H/E 6,585,100 71,600 3,612,000 2,695, ,500 19

20 Table A.1 (continued) Payroll Taxes by Components, (continued) Thousands of dollars Total 45,275, , ,284 1,002, ,922 12,973,464 18,336,837 1,509,107 1,045,149 3,523,869 5,327,851 EI 19,718, ,273 73, , ,142 4,651,392 8,010, , ,499 1,893,007 2,591,973 C/QPP 15,530, ,068 58, , ,240 3,652,268 6,260, , ,346 1,530,800 2,094,736 WC 6,401, ,988 17, ,979 85,973 1,737,244 2,572, , , , ,762 H/E 6,944,000 69,600 3,893,000 2,772, ,400 Total 48,594, , ,558 1,099, ,355 13,933,904 19,616,459 1,612,553 1,139,699 3,840,853 5,677,471 EI 19,073, ,331 71, , ,032 4,497,837 7,744, , ,059 1,830,070 2,516,271 C/QPP 17,611, ,754 66, , ,722 4,134,816 7,103, , ,220 1,735,190 2,382,518 WC 6,470, ,199 19, ,500 91,698 1,803,111 2,652, , , , ,702 H/E 7,261,900 68,500 4,117,000 2,851, ,400 Total 50,417, , ,746 1,143, ,452 14,552,764 20,351,868 1,675,899 1,158,580 3,977,460 5,815,491 EI 18,842, ,386 72, , ,073 4,465,221 7,723, , ,972 1,781,772 2,424,458 C/QPP 20,253, ,102 78, , ,650 4,766,456 8,266, , ,830 1,967,412 2,672,904 WC 6,409, ,999 19, , ,798 1,714,673 2,768, , , , ,497 H/E 7,584,700 71,700 4,291,000 2,992, ,000 Total 53,090, , ,915 1,232, ,521 15,237,350 21,750,436 1,718,709 1,201,100 4,103,481 5,972,859 EI 18,741, ,719 71, , ,762 4,445,849 7,700, , ,318 1,810,815 2,388,024 C/QPP 23,886, ,680 92, , ,282 5,603,392 9,797, , ,054 2,378,058 3,124,220 WC 6,476, ,397 23, , ,205 1,749,994 2,730, , , , ,197 H/E 7,910,500 76,500 4,488,000 3,118, ,000 Total 57,015, , ,397 1,294,122 1,076,249 16,287,235 23,346,914 1,823,581 1,253,770 4,582,678 6,378,441 EI 18,059, ,716 69, , ,551 4,277,078 7,394, , ,549 1,814,306 2,281,094 C/QPP 27,377, , , , ,008 6,407,610 11,197, , ,340 2,838,084 3,546,252 WC 6,716, ,399 23, , ,498 1,800,003 2,726, , , , ,399 H/E 8,037,900 81,500 4,291,000 3,424, , Total 60,190, , ,635 1,354,755 1,105,057 16,775,691 24,742,859 1,935,065 1,341,287 5,160,988 6,743,745 EI 17,971, ,069 70, , ,582 4,298,388 7,319, , ,292 1,816,990 2,241,398 C/QPP 30,879, , , , ,270 7,294,616 12,570,348 1,046, ,824 3,224,414 3,953,446 20

21 Table A.1 (continued) Payroll Taxes by Components, Thousands of dollars WC 7,190, ,800 24, , ,700 1,764,000 2,899, , , ,400 1,019,300 H/E 7,892,037 83,800 4,068,000 3,496, ,300 Total 63,933, , ,627 1,466,089 1,201,552 17,425,004 26,286,038 2,060,898 1,448,316 5,721,804 7,214,144 EI 17,594, ,739 70, , ,343 4,214,172 7,154, , ,763 1,790,556 2,175,108 C/QPP 33,787, , , , ,170 7,991,668 13,743,566 1,145, ,122 3,550,298 4,287,636 WC 7,769, ,200 26, , ,100 1,993,000 2,928, , , ,600 1,077,000 H/E 8,562,347 88,000 4,649,000 3,561, ,400 Total 67,714, , ,055 1,545,489 1,275,613 18,847,840 27,388,580 2,185,183 1,541,185 6,218,454 7,539,744 EI 16,909, ,169 70, , ,423 4,040,681 6,820, , ,527 1,766,055 2,110,743 C/QPP 35,080, , , , ,212 8,291,716 14,192,566 1,191, ,020 3,787,076 4,488,510 WC 8,487, ,000 28, , ,800 2,243,310 3,140, , , ,200 1,175,200 H/E 8,998,463 90,700 4,874,000 3,752, ,800 Total 69,476, , ,105 1,551,637 1,295,435 19,449,707 27,907,361 2,240,397 1,562,847 6,489,331 7,774,453 EI 17,249, ,505 71, , ,350 4,075,119 6,907, , ,528 1,892,532 2,182,267 C/QPP 36,885, , , , ,246 8,617,320 14,817,276 1,237, ,486 4,180,712 4,776,322 WC 8,865, ,200 28, , ,000 2,447,450 3,189, , , ,900 1,240,000 H/E 9,320,006 93,000 5,047,000 3,885, ,300 Total 72,320, , ,035 1,608,717 1,327,596 20,186,889 28,800,923 2,318,205 1,610,514 7,052,144 8,198,589 EI 17,482, ,920 70, , ,445 4,357,875 6,752, , ,134 1,997,342 2,213,907 C/QPP 38,982, , , , ,354 8,929,008 15,460,388 1,303,642 1,009,978 4,708,588 5,169,408 WC 9,143, ,110 29, , ,800 2,432,765 3,385, , ,700 1,003,300 1,267,000 H/E 9,661,090 98,700 5,053,000 4,197, ,100 Total 75,269, , ,683 1,638,364 1,350,599 20,772,648 29,795,127 2,425,420 1,686,812 7,709,230 8,650,315 EI 17,732, ,057 70, , ,603 4,421,681 6,761, , ,210 2,106,533 2,254,083 C/QPP 41,403, , , , ,444 9,433,904 16,234,304 1,389,252 1,088,152 5,211,330 5,514,246 WC 9,111, ,700 29, , ,200 2,449,976 3,523, , , ,700 1,082,000 H/E 10,207, ,500 5,404,000 4,371, ,800 Total 78,454,874 1,013, ,403 1,691,425 1,421,247 21,709,561 30,889,570 2,537,458 1,790,862 8,295,563 8,850,329 21

22 Table A.2 Average Payroll Taxes per Wage and Salary Worker, dollars , , , , , ,420 1,126 1, , , ,064 1,079 1,652 1,301 1, , , ,187 1,207 1,893 1,506 1, , , ,076 1,305 1,378 2,159 1,721 1, , , ,143 1,340 1,422 2,302 1,888 1, ,030 1, ,129 1,246 1,414 1,609 1,682 2,599 2,561 1,884 1,138 1,268 1, ,458 1,569 1,731 1,946 1,977 2,954 2,986 2,193 1,303 1,410 1, ,807 1,881 1,971 2,337 2,278 3,429 3,347 2,521 1,558 1,645 2, ,968 2,013 2,156 2,455 2,369 3,607 3,472 2,541 1,610 1,779 2, ,085 2,146 2,149 2,590 2,545 3,751 3,549 2,644 1,715 1,866 2, ,244 2,231 2,263 2,652 2,622 4,041 3,727 2,787 1,917 1,833 2, ,269 2,278 2,384 2,643 2,653 4,148 3,727 2,896 2,074 1,842 2, ,487 2,468 2,435 2,880 2,811 4,452 3,961 3,032 2,140 1,970 3, ,506 2,519 2,601 2,893 2,869 4,538 3,974 3,068 2,076 1,881 3, ,630 2,590 2,793 3,098 3,090 4,667 4,108 3,164 2,241 2,037 3, ,959 3,082 3,080 3,293 3,405 4,992 4,342 3,334 2,468 2,569 3, ,192 3,172 3,327 3,449 3,532 5,180 4,560 3,623 2,681 2,862 3, ,429 3,403 3,642 3,730 3,653 5,329 4,888 3,897 2,988 3,024 4, ,731 3,623 3,874 4,062 3,974 5,854 5,051 4,141 3,192 3,497 4, ,894 3,995 4,017 4,062 4,083 6,062 5,141 4,333 3,377 3,786 4, ,187 4,464 4,121 4,344 4,336 6,331 5,295 4,559 3,604 4,437 4, ,408 5,207 4,194 4,460 4,417 6,569 5,462 4,920 3,892 4,686 4, ,685 5,449 4,435 4,634 4,660 6,913 5,720 5,275 4,390 5,028 4,889 Percent growth

23 Table A.3 Payroll Taxes as a Percentage of Gross Domestic Product, Percent growth

24 Table A.4 Payroll Taxes as a Percentage of Total Federal and Provincial Government revenues, Percent growth

25 Table A.5 : Effective Payroll Tax Rates by Component, Percent EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total (continued) 25

26 Table A.5 (continued) Effective Payroll Tax Rates by Components, Percent EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP (continued) 26

27 Table A.5 (continued) Effective Payroll Tax Rates by Components, Percent WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total (continued) 27

28 Table A.5 (continued) Effective Payroll Tax Rates by Components, Percent EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP (continued) 28

29 Table A.5 (continued) Effective Payroll Tax Rates by Components, Percent WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total (continued) 29

30 Table A.5 (continued) Effective Payroll Tax Rates by Components, Percent EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP WC H/E Total EI C/QPP (continued) 30

31 Table A.5 (continued) Effective Payroll Tax Rates by Components, Percent WC H/E Total EI C/QPP WC H/E Total

32 Table A.6 Growth of Effective Payroll Tax Rates and Contribution of Components, : Rate change (%) % Contribution EI C/QPP WC H/E/T/Training n.a. n.a. n.a n.a. n.a. n.a : Rate change (%) % Contribution EI C/QPP WC H/E/T/Training n.a. n.a. n.a n.a. n.a. n.a : Rate change (%) % Contribution EI C/QPP WC H/E/T/Training n.a. n.a. n.a n.a. n.a. n.a % Contribution EI C/QPP WC H/E/T/Training n.a. n.a. n.a n.a. n.a. n.a. 32