Workers to see less in pay cheque during 2012
By Contributor
Increases to employment insurance and Canada Pension Plan deductions mean both employers and employees will be taking a hit in the pocketbook starting Sunday, Jan. 1.
The Canadian Taxpayers Federation released its annual New Year Tax Changes calculations, which show the two groups combined will pay an extra $306 in payroll taxes in 2012.
The EI rate rises from 1.78 per cent to 1.83 per cent for employees, who will also see maximum insurable earnings rise from $44,200 to $45,900, the federation says.
Meanwhile, the maximum pensionable earnings rise from $48,300 to $50,100, bringing the total increase in payroll taxes to $142.
For employers, the EI rate will increase from 2.46 to 2.56 per cent, which, along with the corresponding increases in maximum EI and CPP amounts, will bring their contributions up by $164 per employee.
According to Federation calculations (which it notes may not add up due to rounding), employees will pay $3,147 in combined payroll taxes in 2012, up from $3,004 in 2011, while employers will fork over $3,483, up from $3,319, for a total of $6,630. In 1994, the earliest year of data provided by the group, total payroll taxes were $4,486.
Unlike the federal government and most other provinces, Nova Scotia, P.E.I. and Manitoba don’t index their income tax rates to the inflation rate — which was 3.6 per cent, 2.6 per cent and 2.5 per cent respectively in those provinces.
Read more: http://www.canada.com/business/Prepare+less+your+package+come/5919211/story.html#ixzz1hr6JBbWC
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