Is it Finally Time to Reduce Income Tax Rates?

[q12]

Finally.

https://www.cbc.ca/news/canada/nova-...ding-1.7129437

But in acknowledgement of the challenges residents face with the cost of living, MacMaster announced that the province will begin indexing personal income tax brackets, the basic personal amount and some non-refundable tax credits to Nova Scotia's rate of inflation on Jan. 1, 2025.

"Cost of living has become top of mind for people as we experience some of the highest increases in inflation in 30 years," MacMaster said in his budget address at Province House.

"The No. 1 ask by Nova Scotians in this year's budget consultation was for tax relief. Madam Speaker, they are going to get it."

Government officials say the changes will amount to an average savings of $69 to $259 per person in 2025, depending on their tax bracket. The average savings will increase to between $231 and $863 in 2028.

The Tories are touting it as the largest tax break in the province's history.

[Dartguard]

Originally Posted by q12

Finally.

https://www.cbc.ca/news/canada/nova-...ding-1.7129437

About Friggin Time.

[fatscat]

Is there a breakdown for what this looks like at different income levels? News is mostly focused on low income but I'm curious about medium-to-high income households

[TheCuriousMind]

Originally Posted by fatscat

Is there a breakdown for what this looks like at different income levels? News is mostly focused on low income but I'm curious about medium-to-high income households

My quick math tells me, for somebody who earns $200k in 2024:
They'll pay $41223 for federal tax and $32160 of NS tax for a total average tax rate of 36.7%

Assuming annual inflation of 2.5%, if the same person earns exactly $200k in 2028:
They'll pay $39482 for federal tax and $31103 of NS tax for a total average tax rate of 35.3%.

Thus, the provincial tax burden on a $200k earner will have decreased $1056, or roughly 3.3% compared to what it was before.

I don't really know why this is framed as a "tax savings" though. If your salary raises with inflation, then your % tax should stay the same. They frame this as a tax break, but really it is just stopping what was before an effective tax INCREASE every year. Over decades, this is why someone who earns $100k in NS currently pays a whopping $6812 (more than 33% more!) income taxes than a $100k earner in BC. And they wonder why many of us young working professionals have left and haven't come back!

[Drybrain]

Originally Posted by TheCuriousMind

I don't really know why this is framed as a "tax savings" though. If your salary raises with inflation, then your % tax should stay the same. They frame this as a tax break, but really it is just stopping what was before an effective tax INCREASE every year. Over decades, this is why someone who earns $100k in NS currently pays a whopping $6812 (more than 33% more!) income taxes than a $100k earner in BC. And they wonder why many of us young working professionals have left and haven't come back!

In fairness, BC has the lowest provincial taxes in Canada unless you're making well over 100k, so that discrepancy isn't really representative of typical discrepancy in provincial tax rates across the country. (And those tax savings in BC, and more, are likely to be eaten up by higher housing costs--though obviously Nova Scotia's housing-affordability advantage has substantially eroded in the past few years.) Not to defend the high tax rates, of course.

[TheCuriousMind]

Originally Posted by Drybrain

In fairness, BC has the lowest provincial taxes in Canada unless you're making well over 100k, so that discrepancy isn't really representative of typical discrepancy in provincial tax rates across the country. (And those tax savings in BC, and more, are likely to be eaten up by higher housing costs--though obviously Nova Scotia's housing-affordability advantage has substantially eroded in the past few years.) Not to defend the high tax rates, of course.

Duly noted. My critique is as much a criticism of NS's over-taxing of the middle class as it is of BC's IMHO much better progressive taxation scheme that really dials up the tax rates on high income people and is a little kinder to the middle class ... although I say this living in QC where they just tax the s*** out of anyone making more than minimum wage, albeit with much more robust childcare, education funding, etc (not healthcare, though, in my limited experience here thus far).

[kzt79]

Originally Posted by TheCuriousMind

My quick math tells me, for somebody who earns $200k in 2024:
They'll pay $41223 for federal tax and $32160 of NS tax for a total average tax rate of 36.7%

Assuming annual inflation of 2.5%, if the same person earns exactly $200k in 2028:
They'll pay $39482 for federal tax and $31103 of NS tax for a total average tax rate of 35.3%.

Thus, the provincial tax burden on a $200k earner will have decreased $1056, or roughly 3.3% compared to what it was before.

I don't really know why this is framed as a "tax savings" though. If your salary raises with inflation, then your % tax should stay the same. They frame this as a tax break, but really it is just stopping what was before an effective tax INCREASE every year. Over decades, this is why someone who earns $100k in NS currently pays a whopping $6812 (more than 33% more!) income taxes than a $100k earner in BC. And they wonder why many of us young working professionals have left and haven't come back!

Exactly. This simply keeps the burden from growing ever heavier relative to everywhere else.

Sadly, most people are totally ignorant of most basic economic concepts let alone things like income tax brackets. A few people are waking up to the fact something has gone badly wrong. We are grossly overtaxed as a country, and it's the worst in Nova Scotia. This has caused a vicious spiral of ambitious talented people and successful companies leaving, meaning the tax burden falls ever heavier on those remaining.

Canada is becoming a relatively poor rich country. On our present course, it's only a matter of time before we are no longer rich at all.

[Dartguard]

Originally Posted by Drybrain

In fairness, BC has the lowest provincial taxes in Canada unless you're making well over 100k, so that discrepancy isn't really representative of typical discrepancy in provincial tax rates across the country. (And those tax savings in BC, and more, are likely to be eaten up by higher housing costs--though obviously Nova Scotia's housing-affordability advantage has substantially eroded in the past few years.) Not to defend the high tax rates, of course.

Yet BC also has ridiculous Carbon Taxes that bite with every fill up.

[Keith P.]

Originally Posted by kzt79

A few people are waking up to the fact something has gone badly wrong. We are grossly overtaxed as a country, and it's the worst in Nova Scotia. This has caused a vicious spiral of ambitious talented people and successful companies leaving, meaning the tax burden falls ever heavier on those remaining.

Canada is becoming a relatively poor rich country. On our present course, it's only a matter of time before we are no longer rich at all.

Yet people keep calling for more govt involvement and spending on the issue du jour with no apparent understanding of the huge cost whenever govt decides to get involved in anything, as it is the single most inefficient way of doing anything. You see it especially in certain forums (*cough*Halifax reddit*cough*) where the mostly young left tend to dominate with their uninformed thoughts of what govt should do, with no connection to how to pay for it. We need less govt, not more, and fewer gold-plated bureaucrats at the public trough.

[kzt79]

Originally Posted by Keith P.

Yet people keep calling for more govt involvement and spending on the issue du jour with no apparent understanding of the huge cost whenever govt decides to get involved in anything, as it is the single most inefficient way of doing anything. You see it especially in certain forums (*cough*Halifax reddit*cough*) where the mostly young left tend to dominate with their uninformed thoughts of what govt should do, with no connection to how to pay for it. We need less govt, not more, and fewer gold-plated bureaucrats at the public trough.

Any time there is any sort of problem great or small, the response is always the same: "gubment gotta do sumpin". Unfortunately, for the reasons you note, they often do.

[OldDartmouthMark]

Originally Posted by kzt79

Any time there is any sort of problem great or small, the response is always the same: "gubment gotta do sumpin". Unfortunately, for the reasons you note, they often do.

Ummm... isn't that what we elect them for? To do something?

If not, then why am I giving them so much of my income in the form of taxes? I want my money back... apparently I'm being ripped off.

[Arrdeeharharharbour]

Originally Posted by OldDartmouthMark

Ummm... isn't that what we elect them for? To do something?

If not, then why am I giving them so much of my income in the form of taxes? I want my money back... apparently I'm being ripped off.

I read on CBC online this morning that our current provincial government is unnecessarily pre-paying out cash resulting in lost interest accrual for us citizens to the tune of multiple millions of dollars. Apparently we are being ripped off.

[OldDartmouthMark]

Originally Posted by Arrdeeharharharbour

I read on CBC online this morning that our current provincial government is unnecessarily pre-paying out cash resulting in lost interest accrual for us citizens to the tune of multiple millions of dollars. Apparently we are being ripped off.

Where does that fall in the realm of whether the government is doing too much for us or not?

Just trying to parse out the above comments... sure we don't want them to spend "too much" by doing "too much"... but what metric are we using to determine what "too much" is?

IMHO, the Houston government actually seems to be doing a good job thus far - not perfect, but better than the last lot anyhow.

Yet, all people seem to want to do is complain about the government.

[kzt79]

Originally Posted by OldDartmouthMark

Ummm... isn't that what we elect them for? To do something?

If not, then why am I giving them so much of my income in the form of taxes? I want my money back... apparently I'm being ripped off.

No, the government should not and cannot be the solution to every person's every problem. Is there a role for government? Absolutely. Healthcare, education, infrastructure, enforcing rule of law. Sure. But as Keith noted government is actually the least efficient, most costly way of doing many things and we'd be better off with less not more. When you look at what we actually receive in services versus what we pay for them in NS, the record is atrocious. I certainly not want more of the same!

I do agree with you, the Houston is government is "less bad". Indexing the personal income tax brackets is a good step, for example. Let's hope there's more to come!

[Arrdeeharharharbour]

Originally Posted by OldDartmouthMark

Where does that fall in the realm of whether the government is doing too much for us or not?

Just trying to parse out the above comments... sure we don't want them to spend "too much" by doing "too much"... but what metric are we using to determine what "too much" is?

IMHO, the Houston government actually seems to be doing a good job thus far - not perfect, but better than the last lot anyhow.

Yet, all people seem to want to do is complain about the government.

Hmmm? I don't know...I just wanted to tie-in the ripping off comment and the story on CBC which seems to provide evidence of lost or forfeited millions of dollars by the current government. But indeed, folks do seem to make a sport out of complaining about the government and I just scored by getting to repeat my ripping off comment.

I'm not tied to a political party and tend to make my voting decision based first and foremost on who has demonstrated that they are a good person. Of course there are secondary considerations too. Houston and McNeil are pretty much equal in my books. My only beef with Houston is his success with his marketing campaign that lead to his winning the last election. Essentially he took advantage of citizen fears and concerns surrounding health care with promises to 'fix' healthcare knowing full well that this is impossible within the current context of the world and our ability as a province to spend. Good on 'em I suppose as he did win... but really? What I see at the federal level with PP makes me want to barf.

I do suggest that many who say 'too much' probably mean that 'not enough is coming my way' much in the way that 'special interest' means 'doesn't interest me' or 'I'm not personally gaining so it must be bad'.

[kzt79]

Originally Posted by Arrdeeharharharbour

I do suggest that many who say 'too much' probably mean that 'not enough is coming my way' much in the way that 'special interest' means 'doesn't interest me' or 'I'm not personally gaining so it must be bad'.

I expect there is some truth to this. It seems the only real way to truly get ahead is belly up to the government trough. I'm talking the consultants pulling down 500K-2M+ for powerpoints which an undergrad could make in less than an hour with ChatGPT. I suppose if I was on that gravy train I wouldn't complain so much, but I guess I didn't make the right friends

By the same token, anyone advocating higher taxation - which we see a shocking amount of given Nova Scotia is already so over-taxed - intends and expects the burden will fall on someone other than themselves, 100% of the time.

[Dartguard]

Originally Posted by Arrdeeharharharbour

Hmmm? I don't know...I just wanted to tie-in the ripping off comment and the story on CBC which seems to provide evidence of lost or forfeited millions of dollars by the current government. But indeed, folks do seem to make a sport out of complaining about the government and I just scored by getting to repeat my ripping off comment.

I'm not tied to a political party and tend to make my voting decision based first and foremost on who has demonstrated that they are a good person. Of course there are secondary considerations too. Houston and McNeil are pretty much equal in my books. My only beef with Houston is his success with his marketing campaign that lead to his winning the last election. Essentially he took advantage of citizen fears and concerns surrounding health care with promises to 'fix' healthcare knowing full well that this is impossible within the current context of the world and our ability as a province to spend. Good on 'em I suppose as he did win... but really? What I see at the federal level with PP makes me want to barf.

I do suggest that many who say 'too much' probably mean that 'not enough is coming my way' much in the way that 'special interest' means 'doesn't interest me' or 'I'm not personally gaining so it must be bad'.

Actually let me give you some insight about the healthcare management under Houstons government. Granted it is second hand after conversations with my Brother but he has worked as an anesthesiologist here in Halifax since the mid Nineties. So an arch of time for comparison.

My brother has noticed three distinct changes since Houston has taken office.
1. Innovation, they are not afraid to change procedures or systems and thus far are taking some risks . Paying the Nurses a bonus, shaking up Nurse training, Buying new tools and materials with a greatly reduced approval process. Buying a half finished Hotel to create post op beds quicker.

2. Measuring outcomes; This is the first Provincial Government that is measuring outcomes and patient care on a literally daily basis. The citizens without Primary care list is driving recruitment, pharmacy participation and mobile clinics that are diverting folks from Emergency rooms. There has been a program set up that keeps track of Open beds, Operations performed
and Doctor resources committed. HUGE pressure to reduce the surgery list.
My Brother two weeks ago quarter backed 11 cosmetic surgeries in one day.
A personal record in his thirty year + career including seven years at Mass General. The Dartmouth General has turned into an Orthopedic factory. Dartmouth General is averaging 12-18 Knees and Hips a day. That Hospital used to be nicknamed the Country Club in the past.
Not now. They are operating on out of town patients that are willing to travel

3.Long term planning that is actually asking the Doctors what they need.
The new QE II is taking longer to start as the Government realizes that in the building of the present QE II someone cut 100 Beds out of the plan as the demographics were trending down. The plan is now for a 60 Year outlook at an at least 2 % population growth curve that will invest in not only the Central hospital but other Metro facility's.

[kzt79]

Originally Posted by Dartguard

Actually let me give you some insight about the healthcare management under Houstons government. Granted it is second hand after conversations with my Brother but he has worked as an anesthesiologist here in Halifax since the mid Nineties. So an arch of time for comparison.

My brother has noticed three distinct changes since Houston has taken office.
1. Innovation, they are not afraid to change procedures or systems and thus far are taking some risks . Paying the Nurses a bonus, shaking up Nurse training, Buying new tools and materials with a greatly reduced approval process. Buying a half finished Hotel to create post op beds quicker.

2. Measuring outcomes; This is the first Provincial Government that is measuring outcomes and patient care on a literally daily basis. The citizens without Primary care list is driving recruitment, pharmacy participation and mobile clinics that are diverting folks from Emergency rooms. There has been a program set up that keeps track of Open beds, Operations performed
and Doctor resources committed. HUGE pressure to reduce the surgery list.
My Brother two weeks ago quarter backed 11 cosmetic surgeries in one day.
A personal record in his thirty year + career including seven years at Mass General. The Dartmouth General has turned into an Orthopedic factory. Dartmouth General is averaging 12-18 Knees and Hips a day. That Hospital used to be nicknamed the Country Club in the past.
Not now. They are operating on out of town patients that are willing to travel

3.Long term planning that is actually asking the Doctors what they need.
The new QE II is taking longer to start as the Government realizes that in the building of the present QE II someone cut 100 Beds out of the plan as the demographics were trending down. The plan is now for a 60 Year outlook at an at least 2 % population growth curve that will invest in not only the Central hospital but other Metro facility's.

Great perspective. I only hope we can see even more meaningful, sustainable positive change. With the population influx and new, younger mindset I think Nova Scotia has its first shot at genuine organic economic growth in my lifetime. Hopefully this opportunity isn't squandered.

[OldDartmouthMark]

Originally Posted by Arrdeeharharharbour

Hmmm? I don't know...I just wanted to tie-in the ripping off comment and the story on CBC which seems to provide evidence of lost or forfeited millions of dollars by the current government. But indeed, folks do seem to make a sport out of complaining about the government and I just scored by getting to repeat my ripping off comment.

I'm not tied to a political party and tend to make my voting decision based first and foremost on who has demonstrated that they are a good person. Of course there are secondary considerations too. Houston and McNeil are pretty much equal in my books. My only beef with Houston is his success with his marketing campaign that lead to his winning the last election. Essentially he took advantage of citizen fears and concerns surrounding health care with promises to 'fix' healthcare knowing full well that this is impossible within the current context of the world and our ability as a province to spend. Good on 'em I suppose as he did win... but really? What I see at the federal level with PP makes me want to barf.

I do suggest that many who say 'too much' probably mean that 'not enough is coming my way' much in the way that 'special interest' means 'doesn't interest me' or 'I'm not personally gaining so it must be bad'.

I get where you're coming from.

My 'ripped off' comment was part of sarcasm, and I hoped that the intent wasn't being missed.

[OldDartmouthMark]

Originally Posted by kzt79

No, the government should not and cannot be the solution to every person's every problem. Is there a role for government? Absolutely. Healthcare, education, infrastructure, enforcing rule of law. Sure. But as Keith noted government is actually the least efficient, most costly way of doing many things and we'd be better off with less not more. When you look at what we actually receive in services versus what we pay for them in NS, the record is atrocious. I certainly not want more of the same!

Who is suggesting that it should be the solution to every person's every problem, though? I was just reacting to a couple of vague assertions that seemed to suggest that we shouldn't want the government to do anything, or perhaps there's some vague line in the sand where acceptable becomes unacceptable, but we have no idea what it is... it's just unacceptable always.

My point is that we give them substantial tax money, therefore I have expectations that they are going to do something with it. Otherwise, if folks think that they shouldn't be involved in anything, then give me my money back and I'll use it for something where I get return for my hard-earned cash.

I'm also not believing that corporate culture always yields the best results. Example: Major grocery retailers making record profits, while prices are higher than ever for consumers. Clearly profit is of higher concern than the well-being of the people. And don't get me started on NS Power...

Anyhow, no biggie... just tossing my 2¢ in on the matter.