Quebecers became $20 billion richer during the pandemic

As incredible as it may seem, Quebec households got richer during the disastrous first year of the COVID-19 pandemic.

That's according to the latest personal tax statistics for 2020, just released by Legault government financier Eric Girard.

While the economy was virtually paralyzed for many months, scores of workers had left their jobs, hospitals were overcrowded, victims of COVID-19 were piling up… households were getting richer without really knowing it!

Result ? Compared to all previous years, 2020 turned out to be the most “lucrative” in terms of personal tax statistics.

Despite forced unemployment

You have to manage: manage to collect and declare more money in 2020 than in 2019 (a normal year), when a large proportion of workers did not work due to the pandemic.

Compared to the “normal” year of 2019, Quebecers’ total income rose by around $20.7 billion to $356 billion in the pandemic year of 2020.

The Quebec government benefited, as taxable income increased by $17.7 billion and about $2.3 billion in additional taxes flowed into the treasury.

Thanks to whom and what?

This $20.7 billion “windfall” is due in large part to the enormous generosity shown by Justin Trudeau in launching a number of programs to support Canadian COVID victims in 2020, including the the following services:

• The Canadian Emergency Response Benefit (CERB)
• The Canada Emergency Student Benefit (CESB)
• The Canada Recovery Benefit (PCRE)
• The Canada Economic Recovery Sickness Benefit (CRSB)
• The Canadian Recovery Benefit for Caregivers (PCREPA)

Part of the PCU was paid for through employment insurance.

These federal emergency and recovery benefits alone brought $17 billion to Quebec households, representing 82% of the increase in gross income during the 2020 pandemic.

Another observation that doesn't stink. In 2020, when large numbers of workers were on forced leave, reported labor income was even higher than that reported in 2019, increasing by $1.4 billion.

The only factor that can explain this is the impact of the Canada Emergency Wage Subsidy, which employers received to continue paying their employees' salaries even if they were not working due to the pandemic.

Big jump in savings

With everything or almost everything closed, except for obviously essential services like grocery stores, households inevitably had to cut back on spending. And oh! They saw record levels of savings.

In 2020, Quebecers saved almost $52 billion, three times as much as in 2019. The household savings rate as a percentage of disposable income (after taxes, social security contributions, etc.) reached 18.5%. That's more than three to four times the savings rate of previous years.

Never seen it!

More people are liable to pay taxes

The number of taxpayers liable to pay taxes increased by 9% in 2020.

Explanation: “This increase in the number of taxpayers liable to pay taxes is explained by the significant amount of unemployment insurance income and benefits related to the health crisis paid in 2020, especially for people with low and middle incomes,” says the Ministry of Finance.

A word about the “rich”

In 2020, there were 611,740 taxpayers in Quebec earning more than $100,000. These “rich” people represented 8.8% of all 6.9 million taxpayers and had a total income of $111 billion, or 31% of all reported income by Quebec residents.

This handful of “rich” people paid 46.7% of the total tax Quebec collected that year. Financially speaking, we should agree that these “rich” people are doing useful work!

TOTAL INCOME IN 2020

Source: Personal tax statistics for 2020