The Liberal government is moving forward with its controversial Capital Gains Tax Upcoming proposed changes House of Commons on Monday.
Tax increases may be included Budget 2024 The bill was introduced in April, but liberal Give it separate legislative treatment in the hope of scoring some political points with its main rivals, the Conservative Party.
Minister of Finance Chrystia Freeland Canadians were reminded at a news conference on Saturday that only a small number of wealthy people and corporations (about 40,000 people or so) will pay more capital gains taxes.
“Tomorrow we are going to introduce some changes whereby a small number of wealthy Canadians will pay more tax when they sell their successful investments,” Freeland told reporters.
Freeland tabled the federal government's 2024 budget on April 16, which included a proposal to increase the inclusion rate (the portion of capital gains that is taxable) to 66.7% for individuals with annual capital gains of more than A$250,000.
Individuals with capital gains of up to $250,000 will continue to be taxed at 50% of their capital gains. But for companies and trusts, there is no threshold. Their inclusion rate will be increased to two-thirds of all capital gains.
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Freeland has been arguing that a small increase in the capital gains tax would bring in about $19 billion in new revenue over five years, which would help the Liberals pay for a raft of new spending on programs such as housing and defense.
Canadian Prime Minister Justin Trudeau recently announced that the tax reform plan will take effect on June 25. If the House of Commons votes in favor of the bill on Monday, that deadline can still be met.
“This week will be an important political moment in our democracy. It will be a time when Canadians will be able to see what each of their MPs believes and stands for,” Freeland said Saturday.
Doctors, lawyers and other professionals have objected to the capital gains tax changes since they were announced, saying their ability to retire and take time off depends on the profits they make from their practices.
The Canadian Medical Association (CMA) said in a statement Saturday that it was “deeply disappointed” by Freeland's announcement that the federal government plans to proceed with tax reforms. The association warned that the change would “place undue stress and financial pressure on physicians and undermine the stability of our health care system.”
Dr. Kathleen Ross, a CMA resident physician, said in an earlier statement that the tax changes have left physicians feeling “betrayed, discouraged and frustrated.”
“We must not create more barriers, put more pressure on medical professionals or prevent future doctors from choosing to practice medicine in Canada,” Ross said.
While the Conservatives have yet to indicate how they will vote on Monday, leader Pierre Poilievre has been vocal in his opposition to capital gains tax reform and the 2024 budget proposal.
After the budget was tabled, Pliyev called Trudeau a fiscal “pyromaniac” in the House of Commons, accusing the Liberals of stoking inflation with their “wasteful” budget.
“It's too hot and the costs are too high for Canadians to afford,” he said.
— Attached is Craig Lord of Global News
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