Canada tops G7 in ease of paying corporate taxes

We sit ninth overall out of 189 in worldwide ranking.

TORONTO — Canada continues to rank in the top 10 countries when it comes to the ease of paying corporate taxes, according to a joint study from global consulting firm PwC and the World Bank Group that reviews tax regimes in 189 economies.

Paying Taxes 2015 shows Canada sits in first place among G7 nations, well ahead of other members, and in the ninth spot overall, with the UK ranked 16th, and the US ranked 47th.

In the G7 after Canada were the UK, US, Germany, France, Japan and Italy.

The study measures the overall ease of paying taxes for a hypothetical medium-sized domestic business by measuring all business taxes paid out as a percentage of business profit; computing the amount of time invested to complete all the necessary tax filing; and adding up the number of annual tax payments.

The objectives of the study are to compare tax systems on a like-for-like basis, identify good tax practises and reforms, and generate robust tax data that can be used to inform tax policy decisions.

“The results of this study are further confirmation that in Canada, there is ongoing tax policy support for small and medium-sized businesses,” says Lincoln Schreiner, Tax Partner, PwC Canada.

Additional global highlights:

• Nearly half (43%) of the 189 economies measured now have electronic filing and payment systems that are used by the majority of companies.

• Central Asia and Eastern Europe continues to be the fastest reforming region with a major focus on improving administrative systems. All three sub-indicators have fallen with the number of payments and time to comply both below the world average.

• Bolivia ranks last of 189 countries, largely due to a total tax rate of 83.7% and the second-highest time to comply at 1,025 hours.

• A 7.4%, total tax rate is lowest in Macedonia, while the time to comply is lowest in the United Arab Emirates (12 hours).

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