Payroll taxes

[Richard]

In the US:

- social security at 6.2% up to wages of about $102,800
- medicare at 1.45%, no limit


In Canada:

- Canadian Pension Plan (social security) at 4.95% up to wages of about $45,000
- employment insurance at 1.73% up to wages of about $43,000


A person getting paid $60,000 a year in New York state will receive a smaller pay cheque than a person earning the same amount in most Canadian provinces, except Quebec.

Although the Canada/Ontario tax rate may look higher, the payroll taxes in the US are very high compared to Canada.  Anyone earning more than about $45,000 in Canada stops paying all payroll taxes.

On $102,000, that extra $57,000 that is taxed (in the US) but not in Canada at the payroll level means an additional 7.65% in income taxes, a considerable amount considering your average tax rate may only be around 25 to 30%.

In 2009, Canadians will not pay more than $2,118.60 (CPP) + $731.60 (EI) = 2,850.20 in payroll taxes, no matter how much you make.  (If you have multiple jobs, your EI and CPP deducted gets refunded.)

Thoughts?

[opebo]

Thoughts?

You spell check funny.

[Associate Justice PiT]

     In San Francisco, the city taxes all businesses at a rate of 1.5% of their payroll for people employed in the city. It doesn't sound like a lot, until you realize payroll is also taxed for social security & medicare.