Capital gains inclusion rate proposal should be delayed, if not scrapped altogether
It’s been almost a month since the Canadian federal budget was released and the long tail on budget articles and comments is normally not that long — perhaps a few days or a week at best.
But the furor over the capital gains inclusion rate increase from the current 50 per cent to two-thirds (with only individuals getting a $250,000 annual threshold at the current 50 per cent inclusion rate) is keeping the discussion alive and lively. The disingenuous and misleading messaging by the government that the proposal will only affect 0.13 per cent of individuals is also angering many.
The fact that Canadians are still talking about this proposal is encouraging. People need to understand how shortsighted this proposal truly is. Canada has a very significant productivity challenge. There are many concerns being raised by common-sense folks who understand this proposal will directly or indirectly have a negative impact on themselves and the country. Canada desperately needs to encourage investment, not discourage it by making it more expensive for people to risk their capital.
In the meantime, many business organizations, such as the Canadian Medical Association (which believes the proposals will impact doctor recruitment and retention), the Mining Association of Canada and others, are speaking out. Pushback and attention are growing, but the government shows no outward sign of backing off. On Monday, the prime minister even released a misleading video in an attempt to double down.
It’s time to change the capital gains tax. Here’s why: pic.twitter.com/a1X1z8rFTu
Over the last month, I have spoken to more than 750 accountants, lawyers, investment advisers and average Canadians either at in-person or virtual info-sessions about the
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