While Canada ranks 99th out of 178 for total tax rate and fairs moderately well in ease of paying taxes and administering taxes there is room for improvement in Canada’s corporate taxation system, says PricewatershousCoopers (PwC).

The study from the World Bank, IFC, and PwC concludes that there is a win-win opportunity for governments and firms if governments simplify tax systems, ease the compliance cost on business, and reduce tax rates.

The study allows direct comparison of tax systems from around the world. The report focuses on the number of tax payments made, the time it takes to comply, and the cost of taxes, which is measured by the total tax rate. The total tax rate covers five types of taxes that firms pay: profit, social, property, turnover, and other taxes, such as municipal fees and fuel taxes. The steps, time, and cost indicators are used to determine the overall ease of paying taxes.

Canada’s ranking this year may seem a step backwards from its 2006 ranking of 77th out of 175. However, according to Tom O’Brien, a PwC Canada tax partner “Since this years report has been written, there has been the elimination of the Canadian Federal Large Corporation Tax which represents a real savings for many corporations operating in Canada. And, with decreases in federal and some provincial corporate income tax rates announced for 2007 to 2010, and the harmonization of the Ontario and Canadian corporate tax systems, Canada’s total tax rate ranking is expected to improve in the near future.”

The top ranking countries with the lowest total tax rate are Vanatu, the Maldives and the United Arab Emirates. The highest are Sierra Leone, Burundi and Gambia. In comparison, the United States lands at the 102 spot and the United Kingdom at 52.