Canada's tax system sees top 20% paying two‑thirds of income taxes amid rising emigration

In Canada, the top 20 % of income‑earning families now pay about 65 % of personal income taxes and 58 % of all taxes, while earning roughly half of total family income. When all levies are counted, the top quintile surrenders about 55 % of its income to the government compared with 18 % for the bottom quintile, making the tax system one of the most progressive among OECD nations.

The fiscal imbalance is prompting a wave of emigration. More than 150,000 Canadians and permanent residents left the country in the last five quarters, with 120,640 departures recorded in 2025 – the highest annual total since Statistics Canada began tracking in 1952. A Bank of Canada study estimates that roughly 40 % of Canadians who would rank in the top 1 % of earners have already moved south, attracted by lower marginal tax rates in U.S. states such as Florida and Texas.

The debate intensified after Shopify CEO Tobi Lütke suggested weighting voting power by income‑tax paid, a proposal quickly rejected as contrary to democratic principles. Analysts cite the Fraser Institute’s findings that Canada already taxes the rich at an internationally extreme level, arguing that further tax hikes on high earners would be ineffective and could exacerbate the outflow of talent.