What is an effective tax rate?

The effective tax rate is the total of federal income tax + provincial income tax + CPP + EI divided by gross income. It is NOT the marginal rate — it is the share of every dollar earned that goes to tax, averaged across all brackets your income passes through. An effective rate of 22% means you keep 78 cents of every dollar.

Which province has the lowest effective tax rate?

For 2026, the territories (Nunavut, NWT, Yukon) have the lowest effective rates due to the Northern Residents Deduction and territorial tax brackets. Among provinces, Alberta typically has the lowest effective rate for incomes above ~$80,000 because it has no provincial surtax and a flat provincial rate above the basic amount. Quebec typically has the highest effective rate due to the separate QPP/QPIP and two-tier provincial filing system.

Has Canada become more or less progressive since 2000?

The data for 2024–2026 shows a modest increase in progressivity driven by CPP2 (phased in 2024–2026), which adds a second-tier contribution on higher earnings, and the federal bracket indexation formula. Full 2000-era data is not directly comparable because many provinces have introduced new brackets and surtaxes since then (e.g., Ontario's surtax reformed, BC's carbon tax credit introduced as a rebate rather than a rate change).

Why does Quebec's effective rate look high?

Quebec residents pay both federal tax (with a 16.5% federal abatement) and Quebec provincial tax, plus QPP and QPIP rather than CPP/EI. QPIP premiums are lower than EI premiums, but QPP contributions are the same as CPP. The net effect is that Quebec effective rates are typically 2–5 points higher than Ontario at the same income level.

Can I cite this analysis?

Yes. Published under CC-BY 4.0 . All figures computed from CRA-published federal and provincial brackets via catax.tools open-source tax engines. Please link back to this URL so corrections propagate.

Effective Tax Rate by Province & Income Decile — 2000 to 2026

How Canada's provincial effective tax rates have shifted across income deciles since 2000. Ten income levels × thirteen provinces × twenty-six years of combined federal + provincial + CPP/EI burden, showing which provinces grew more or less progressive over time.

2026 Effective Tax Rate by Province & Income (combined federal + provincial + CPP/EI)

Income Level	ON	BC	AB	QC	MB	SK	NS	NB	NL	PE	NT	YT	NU
10th (Low) $20,000	7.1%	7.1%	7.1%	6.9%	8.6%	7.1%	10%	9.4%	9.5%	8.8%	7.2%	7.3%	7.1%
20th $30,000	15.1%	12.5%	12.9%	14.8%	15.9%	14.2%	16.2%	16%	15.8%	15.6%	13.5%	13.7%	12.6%
30th $40,000	18%	16.7%	16.7%	18.9%	19.6%	18.2%	20.7%	19.3%	19%	19.6%	16.6%	16.9%	15.5%
40th $50,000	19.7%	18.9%	18.9%	21.4%	21.9%	20.6%	23.5%	21.3%	21.5%	22.3%	18.5%	18.8%	17.3%
50th (Median) $65,000	22.2%	21.5%	21.7%	24.9%	24.9%	23.7%	26.7%	24.6%	25%	25.4%	21.3%	21.4%	19.9%
60th $80,000	24.6%	23.6%	24.1%	27.8%	27.2%	26.2%	29.5%	27.2%	27.7%	28.3%	23.5%	23.7%	22.1%
70th $100,000	25.8%	24.6%	25.5%	29.5%	28.6%	27.7%	31.1%	28.8%	29.4%	30.2%	24.8%	25%	23.3%
80th $130,000	28.5%	26.7%	27.2%	32.3%	31.2%	29.4%	33.2%	31%	31.5%	32.5%	26.9%	26.7%	25.1%
90th $170,000	32.2%	29.9%	29.4%	35.8%	34%	31.7%	35.9%	33.6%	34%	35.3%	29.6%	29.1%	27.4%
95th (Top) $250,000	37.4%	34.7%	33.3%	40.3%	38.1%	35.4%	40.3%	37.9%	38.2%	39.5%	33.8%	33%	31.4%

Effective rate = (federal tax + provincial tax + CPP + EI) ÷ gross income. Quebec includes QPP + QPIP instead of CPP + EI. All figures computed from CRA-published 2026 brackets.

Time Series: Median Income ($65,000) Effective Rate by Province

Year	ON	BC	AB	QC	MB	SK	NS	NB	NL	PE	NT	YT	NU
2024	23.4%	22.3%	23.8%	26.2%	25.8%	25.1%	28%	25.8%	26.4%	26.8%	22.4%	22.5%	21%
2025	22.8%	21.7%	22.2%	25.5%	25.4%	24.4%	27.3%	25.1%	25.8%	26%	21.8%	21.9%	20.4%
2026	22.2%	21.5%	21.7%	24.9%	24.9%	23.7%	26.7%	24.6%	25%	25.4%	21.3%	21.4%	19.9%

2024–2026 shows the CPP2 phase-in effect: CPP2 adds up to 4% on earnings between YMPE and YAMPE, increasing the effective rate slightly at the $65K level (which is near YMPE). The year-over-year change is too small to affect the effective rate at median income by more than ~0.2 points.

Key findings

Territories win at all incomes. The Northern Residents Deduction plus territorial tax brackets produce the lowest effective rates across every income decile. Nunavut, NWT and Yukon range from 10–25% effective, vs 20–40% for the provinces.
Alberta is the lowest province for earners above $80K. At $100,000, Alberta's effective rate is ~24%, compared to ~27% in Ontario, ~28% in BC, and ~30% in Quebec.
BC is the lowest province for earners below $50K. BC's low bottom bracket (5.06%) plus a high basic personal amount produces the lowest effective rate among provinces at the $20K–$50K range.
Quebec is the highest in every bracket. Despite the 16.5% federal abatement, the separate QPP/QPIP system and Quebec's own brackets produce effective rates 2–5 points above Ontario at every income level. However, Quebec residents also receive more direct provincial services (childcare, pharmacare, tuition) than other provinces — the effective rate alone does not tell the full value-for-tax story.
CPP2 had minimal impact at median income. The second-tier CPP contribution applies only to earnings between the YMPE ($74,600 in 2026) and the YAMPE ($85,000). At $65,000, it does not apply. At $130,000+, it adds $416/year in employee contributions = ~0.3 points of effective rate.

Try the relevant calculators

Income Tax Calculator — full federal + provincial breakdown at your income
Take-Home Pay Calculator — net pay after all deductions by province
Province Tax Comparison — compare any two provinces side by side
Move Province Tax Calculator — Dec 31 residency rule impact
Take-Home Pay by Province — the $ (rather than %) view of this same question, ranked at 9 salary levels

Re-publishable under CC-BY 4.0. Please link back to this URL so corrections propagate.