Marginal tax rate is the rate at which your next dollar of income will be taxed.
All of your income is not taxed at the same rate - different tax brackets are taxed at different
rates, resulting in an average tax rate. The rates are determined each year by both the
federal and provincial governments, and together form a combined rate.
For example, for
2023, the federal tax rates are:
-
15% on the first $53,359 of taxable income, plus
-
20.5% on the next $53,358 of taxable income, plus
-
26% on the next $58,713 of taxable income, plus
-
29% of taxable income over $165,430.
The provincial rates for
2023 for Manitoba are:
- 10.8% on the first $36,842 of taxable income, plus
- 12.75% on the next $42,783, plus
- 17.4% of the amount over $79,625.