A new wealth study shows that Canada ranks fifth in the world in terms of the number of residents worth at least US $30 million. And these ultra-rich get richer faster than other Canadians.
According to research firm Wealth-X, in 2017 Canada had about 10,840 residents whose assets were worth $30 million or more, including their investment assets.
The New York-based company publishes this study every year from its database of high net worth individuals.
Only the United States, Japan, China and Germany had more people considered ultra-rich than Canada.
France, Hong Kong, the United Kingdom, Switzerland and Italy all fell below Canada.
The absence of inheritance rights
Ricardo Tranjan, principal investigator at the Canadian Center for Policy Alternatives (CCPA), is not surprised that Canada has more ultra-wealthy residents than many European countries.
He explains that a recent study, conducted by the French economist Thomas Piketty, has shown that ” inheritance taxes are an essential mechanism for the distribution of wealth ” and that “Canada has no such tax, unlike most European countries “.
Germany, the only European country to appear before Canada on the Wealth-X list, receives an inheritance tax, but it has a much larger economy than Canada.
The idea of a formal inheritance tax in Canada, the only G7 country that does not have one, is controversial. It was proposed by the New Democratic Party (NDP), which introduced this tax as a potential tool to reduce wealth inequality.
Rich people richer
Wealth-X also reports that the number of Canadians with net worth of $ 30 million or more increased by almost 14% last year compared to 2016, compared to 13% worldwide, while total wealth has increased by almost 15% to reach more than 1100 billion dollars.
CCAC research also suggests that the rich get richer faster than average Canadians.
[Our] research found that the average net worth of Canada’s wealthiest families increased by 37% between 2012 and 2016, while the net worth of middle-class families increased by 16%.
Ricardo Tranjan, CCPA researcher
For Wealth-X, the prosperity of the ultra-rich Canadian would be linked to good economic growth, higher yields and a stronger currency, but also to the Trump administration tax reform project “which provides generous exemptions businesses and the ultra-rich “.
The Canadian economy also experienced strong growth of 3% last year, while stock markets rebounded thanks to Donald Trump’s tax reform policies.
The Canadian dollar also increased more than 7% in 2017 against the greenback.
But this pace may not continue, said Wealth-X.
The research firm estimates that North America could record the slowest growth in the number of people with $ 30 million or more over the next five years. The Asia-Pacific region, meanwhile, could catch up with North America for the number of ultra-rich people during the same period.
It is in the emerging markets of Asia, Latin America and the Caribbean that wealth is now growing fastest.
Bryce Fortino is a Senior Politics Reporter at Spruce Tribune covering state and national politics, . Before joining Spruce Tribune Chronicle, Bryce worked on several provincial campaigns including Jack Layton. Bryce has worked as a freelance journalist in Toronto, having been published by over 20 outlets including CBC, the Center for Media and VICE.com.