While doing a little research recently, I was surprised to learn that relatively few people know how taxes are calculated. Of the 52.7 cents we pay on each incremental dollar earned, only 21.4 cents go to the Province.
Provincial taxes are a percentage of federal taxes, i.e. they are taxes on taxes.
In fact, there are four levels of taxation - federal tax, provincial tax, and both federal and provincial surtaxes. I recently asked a former finance minister if he could recall the origin of the surtaxes, i.e. if they were a temporary measure of some sort. He could not recall. So, as a reward for good fiscal performance, we get a little tax break. We are forgetting that investment drives development.