Canada offers competitive tax structure: KPMG

Canada reigns as one of the most competitive countries in the world when it comes to paying taxes.

In a recent KPMG study, three of Canada’s major cities—Vancouver, Toronto and Montreal—ranked in the top 10 among 55 major international cities for offering better rates to businesses and residents.

Read: Business owners plan for growth

All locations included in the study were graded based on the total amount of taxes faced by their companies, including corporate income, capital, sales and property taxes.

Read: Tax issues for immigrant clients

“The study makes international comparisons based on the results of different business scenarios,” says Elio Luongo, Canadian managing partner of Tax at KPMG in Canada.

“Canada continues to offer a very competitive structure, which is crucial to attracting inbound investment, spurring innovation, and creating jobs.”

Read: Help business owners find funding

Canada also ranked as the most tax-efficient country in the global, mature market; all of Canadian major cities ranked ahead of the U.S. cities observed.

Read: How the CRA finds unreported income

The study finds Brazil, Russia, India and China are currently the top high-growth countries on the global stage.

Forbes’ reminds, though, “there is some wiggle room in the study, with tax burdens across the globe varying by industry, the underlying cost of doing business and by how the taxes are weighted in each region.”

See charts below for more info:

Canada vs. the Globe

Overall rankings and total tax cost indices for featured countries (Listed by market type from lowest Total Tax Index (TTI)** to highest TTI)
Overall 2012 Rank	Mature or High Growth Rank	Country	2012 Total Tax Index**	% tax cost advantage versus US
High Growth Market
1	1	India	49.7	50.3%
3	2	China	59.7	40.3%
4	3	Mexico	63.6	36.4%
5	4	Russia	71.7	28.3%
11	5	Brazil	142.6	-42.6%
Mature Market
2	1	Canada	59.1	40.9%
6	2	United Kingdom	73.3	26.7%
7	3	Netherlands	77.2	22.8%
8	4	United States	100.0	0.0%
9	5	Germany	122.0	-22.0%
10	6	Australia	125.1	-25.1%
12	7	Japan	152.3	-52.3%
13	8	Italy	152.9	-52.9%
14	9	France	179.7	-79.7%

**Total tax costs are compared between countries and cities using a TTI for each location. The TTI is a measure of the total taxes paid by corporations in a particular location, expressed as a percentage of total taxes paid by corporations in the United States (US). The U.S .has a TTI of 100.0, which represents the benchmark against which the other countries and cities are scored. For example, an overall index number of 59.1 means total tax costs are 40.9 percent lower in that country than in the United States.

Ranking of Canadian cities

Overall rankings and total tax cost indices for featured Canadian cities (Listed from lowest Total Tax Index (TTI) to highest TTI)
2012 Rank	City	2012 Total Tax Index		2012 Rank	City	2012 Total Tax Index
1	Saskatoon	43.8		9	Trois-Rivières	53.8
2	Edmonton	44.2		10	Prince George	54.2
3	Moncton	45.1		11	Charlottetown	54.4
4	St. John’s	45.4		12	Winnipeg	54.7
5	Fredericton	45.5		13	Toronto	56.0
6	Vancouver	49.2		14	Windsor-Essex	56.8
7	Halifax	49.4		15	Montréal	62.1
8	Calgary	50.7		16	Québec City	62.8