Extreme Wealth Inequality Persists
There was little or no media coverage of the release of data on the distribution of the wealth of Canadians in 2016 last week, perhaps because there has been little or no change since the last Survey of Financial Security in 2012.
The top 20% of Canadians own 67.3% of all net worth (assets of all kinds minus liabilities), almost exactly the same as in 2012.
The bottom 20% have no net worth, and the bottom 40% collectively own just 2.3% of all net worth.
The top 20% also own 74.6% of all financial assets (stocks, bonds, bank deposits etc) held outside of RRSPs and registered pension plans, while the bottom 40% collectively own just 3.5% of such assets. Financial assets outside of pensions total $1.4 trillion.
Unfortunately, the new data does not detail the breakdown within the top 20%. Even within this group, wealth is highly concentrated in the hands of the top 10% and top 1%.
Clearly, taxable income from financial assets (interest, dividends, capital gains, stock options) flows overwhelmingly to a relatively small number of people. If the federal government was serious about progressive tax reform, they would be reducing the preferential treatment of such income in the personal income tax system. Over to you, Minister Morneau.