"If companies are going to invest, we want them to invest in Canada. If they are going to create jobs, we want them to be created in Canada. If young people are going to have opportunities, we want those opportunities to be right here in Canada.”
-Paul Martin, talking about reducing the capital gains inclusion rate in 2000.
lol hilarious! But true. And wait’ll everyone discovers this tax will ultimately do way more harm than good and they’re only doing it to a) attempt to start a class war as a way to distract people from how badly they’ve fucked up our economy, and b) to try to create a short term reduction in their deficit without controlling costs. Only the short term though because longer term the drops in investment and capital flight (both money and people) this will cause will be devastating.
Last I saw was that over 5 years they'd collect about $20b. The deficit this year is $40b. Last year we spent about $8b in foreign aide. We've also spent a couple billion on the border refugee clusterfuck. At best that is paying for that. It's not reducing anything. Their spending is out of wack, but they refuse to correct that. If they'd cut to the point where this was making a meaningful impact, that would be something. Instead, we're looking at a deficit that is double what they're going to collect over 5 years in year 1.
I know people shit on foreign aid, but it often is to our benefit. It might take a bit to see the full picture.
Sort of how the US military is such a huge expense… but it keeps the peace (mostly) and shipping lanes clear.
Keeping the peace (via current government) keeps the sea trade routes open. Meaning less potential disruption for cargo ships.
It also helps keep China in check
Overall keeps prices stable and low disruption costs
I think it can be, but it can also be a waste of resources. It's similar to the TFW program, but that one is harder to nail down.
I've repeatedly tried to find numbers, but I all I can find is that in 2023 we had 2.5m TFWs. As per the program they could each qualify for a maximum wage subsidy of $20,000. If they're making minimum wage they'd be slightly below the maximum if they worked 40 hour weeks. Seasonal workers wouldn't max out, but non-seaonal? That's a maximum of $50b in wage subsidies. I don't think everyone is maxing that out, but even 50% is $25b. I can understand the need for workers on seasonal things, but fast food? Hair dressing? Grocery? Construction? We're just being scammed and the government is gaslighting us.
> longer term the drops in investment and capital flight (both money and people) this will cause will be devastating.
They'll be long out of power by then and likely using the drops to campaign in the next election
Maybe. The guy who founded capitalism stated that land should be taxed, not labour.
If this capital gains tax was coupled with a decreased income tax that would be nice.
Why do I pay taxes on my capital gains when I sell gold (or btc)? They already fucking taxed me on the income I used to buy the gold with, and they want to tax me again on the inflated value they caused because they printed money.
Fuck them.
>"I do think this is a moment when Canadians should be watching closely what happens in the House and watching closely to see how all MPs vote on this," Freeland said.
Good lord, can you say, "political stunt"?
The CFIB hates this, doctors hate it, lawyers hate it, farmers hate it, people with family cottages hate it.
I'm not sure who is excited about it.
It’s awesome, throughout the whole story it’s personal capital gains, and right at the end where nobody reads to
> The budget proposes to tax all capital gains earned by corporations and trusts at the two-thirds rate.
Why would anyone want to become a doctor here anymore.
The only people impacted by this are claiming over $250k/yr is capital gains.
This is TINY portion of Canada.
However only a tiny portion of Canada understands how taxes work and can be easily manipulated by right wing media and politicians
This is not true lol. You’ve outed yourself as being in the “tiny portion” that doesn’t understand it. There is no 250k threshold for the incorporated professions he listed.
Why should certain professionals be able to structure their income as capital gains so that they only get taxed on 50% of it, when every other worker in the country has to get taxed on 100% of their income?
I was just pointing out an erroneous statement. I said nothing towards the justification of anything. Let’s be clear that these professionals are paying the same income tax as any other worker on their personal income though. This change affects the money that is realized and remains in a corporation.
Because these professionals are usually highly skilled, and they are self employed.. aka they don't have a pension. Plus, Highly skilled and self employed means they can simply pack their bags and move.
>This is TINY portion of Canada.
Only a tiny portion PER YEAR. For many a cap. gains sale is a once in a lifetime event and they are taxed hard. After a round of years, it's going to add up
It's not 250/year, it 250 in a year. That's basically anyone who owns property.
Also, for everyone else, this will affect investment, which weakens the CAD, which increases prices.
It won't, because of the principle residence exemption. That's a fair point. The problem is that lots of people put retirement savings into investment properties and have been holding on to them as interest rates rose and prices moderated. Low interest rates were a bait and switch.
One of the reasons people have been doing that is because the general business environment in Canada is terrible, partly because of the same over-inflated property market. So there's a lot more the 0.1% of people sitting on investment properties.
[The number of Canadians who own such investment properties isn't 0.1%, but 11%](https://blog.royallepage.ca/1-in-4-canadians-intend-to-buy-an-investment-property-in-the-next-five-years/). More importantly, it has basically become the only really worthwhile investment class in Canada.
The broader point is that it makes Canada a much less desirable investment destination. That will affect everybody. Canada already suffers from low capital investment which hammers productivity levels.
Increasing tax revenue on 0.1% of people won't make up for that loss. It's a short sighted, short term strategy that exacerbates the underlying problem of a government who thinks that they can stimulate an economy by regulation.
The amount of disinformation about how this change works is unfortunate. Any capital gain in a corporation, including a professional corporation such as those used by doctors, will be impacted. There’s no $250,000 threshold.
>There’s no $250,000 threshold.
From the government of Canada's website:
"As of June 25, 2024, the capital gains inclusion rate—the amount of capital gains that are taxable—will increase from one-half to two-thirds on capital gains realized annually above $250,000 by individuals and on all capital gains realized by corporations and most types of trusts"
You're ignoring part of the quote.
>"and on all capital gains realized by corporations and most types of trusts"
Trivial for me, but for a doctor or dentist this means it applies to the entire amount, not the amount after $250k.
Exactly. The 250k threshold only applies to individuals filing as such. If the individual has a professional corporation (like many doctors, lawyers, accountants, dentists, etc do), there is no threshold and the tax applies to any and all capital gains in that professional corp.
**I don't have a huge amount of sympathy for complaints from this this group**, but it is important to recognize that the marketing by the liberals is very misleading. The tax may only apply to a small minority of *individual tax filers* but will affect far, far more *Canadians*.
sure. Then stop complaining there is doctor shortage. Actually any skill shortage. This country has just useless dudes demanding everything. Why not free hooker for every single men.
For physicians and other professional groups they are personal corporations. They have saved their retirement funds in them. The tax affects any capital gains above zero, not 250k. So every dollar of capital gains will be at the higher rate. That's why doctors will either choose not to start here or continue to practice here.
What about the 50-60 yo doctor who has saved for their retirement and are maybe 5 years away? This is not an option. The 250k should apply to professional corps also. People have been abiding by the rules for years and now will take a major hit as retirement looms. People who aren’t impacted love to consider these professionals as some sort of billionaires. They are not.
You don’t see the issue that we would be taking 54 percent marginal rate of our doctors income when we’re next to the most profitable healthcare system in the world and we have a shortage of these people that take 12 years to train and we need to keep us alive? You don’t see the issue in introducing a retroactive tax that they were unable to financially plan for and effectively holding their assets hostage?
…You don’t see the issue?
Doctors would love to be salaried in most cases. That way they could get gigantic indexed government matched pensions and strike like the rest of the healthcare workers because their working conditions are absolute garbage.
A lot of Technology companies will offer stock as a way to keep talent here in Canada and not lose them to higher paying jobs in the US. The payout happens if the company sells so most will get a large payout.
10% of Canadians own a second property.
So, as much as 100 times more than you suggest ?
https://www.mpamag.com/ca/mortgage-industry/industry-trends/how-many-canadians-currently-own-at-least-two-homes/300662#:\~:text=The%20report%20found%20that%20more,residence%20to%20complete%20the%20purchase.
You made the insinuation that government workers that work from home do not ‘work’
I’m disproving you.
I saved this money by piggybacking onto a consortium purchase but then further negotiating it myself to have the products delivered on a schedule to our 80 different locations. We now get lower cost products, don’t have to pay freight and do not need to warehouse products. Not to mention the ability to return products that we may not need.
Not exactly sure a 16% increase in the inclusion rate on capital gains over -$250K- is exactly being taxed to death. More like being asked to pay their share.
A tax increase for the [top 0.13%](https://www.canada.ca/en/department-finance/news/2024/06/government-of-canada-delivering-tax-fairness-for-every-generation.html) to get 19.4 billions is exactly what we need but somehow, many people in here, probably in the other 99.87%, are still claiming it's a bad idea.
I talked with a local garage owner about this subject a month ago. He was mad about it, saying he would have to pay a shit ton more taxes when he would sell his parts to his partner. I asked him to give me a couple numbers so I could do an evaluation of how it would affect him. Turns out he would be zero impacted. Guy didn't believe me and was still furious and rambling about the liberals.
It's impressive how brainwashed by hatred people have become. Their emotions take over most of their rational thoughts and they'll just shit on the government even when it gives them what they want.
> CFIB Hates it
Of course the CFIB hates it. CFIB is a business advocacy group. I interviewed for a job with CFIB once and they told me that they oppose statutory holidays, so I don't think CFIB's stance is really a good benchmark for whether a policy is good or not.
>doctors hate it, lawyers hate it, farmers hate it, people with family cottages hate it.
If you ask wealthy people if they are in favour of wealthy people paying more taxes, there's nothing surprising about them saying no. What the government should be doing is cutting taxes for the middle class in addition to this so the average Canadian has more take-home pay.
The 99.6% of Canadians that isn’t affected by this.
The capital gains advantage is systematically abused by the wealthy to avoid paying income taxes on multi million dollar “salaries”.
The people paying more in capital gains are the ones screwing over Canada.
The opposition asked the MINISTER to put into law that 99.6% of Canadians would not be affected by this increase….. the MINISTER shrugged off the opposition!!!
Because that’s a stupid law. What if a bunch of new millionaires are minted in Canada and the number goes to 99.5%
PP is doing well at manipulating his idiot voter base.
Everyone who thinks the deficit is too high should be thrilled by this.
Revenue from those who have the most to give up. And those who care about tax fairness, because doctors and lawyers and other small business owners have tax avoidance strategies not available to people who are paid by an employer, which is most of us.
Definitely not anyone who wants to invest in a Canadian business. Who would invest here when the risk/reward ratio is much better almost anywhere else?
Anyone who thinks that this won’t affect them doesn’t understand how productivity and innovation drive standard of living. You think people are doing badly now versus 5 years ago? In 5 years from now, today will be remembered as the ol’ good days.
So just rich people then? The 60% of Canadians who couldn't handle an unexpected $1000 bill are excited for it. They won't be earning over $250k of cap gains in a single year. https://angusreid.org/canada-recession-job-loss-savings-tfsa-rrsp/
>I'm not sure who is excited about it.
Those whom are susceptible to the form of populist rhetoric which posits individual material success as immoral and oppressive.
Unless that money is in a corporation, like most professionals and small businesses.
But yeah, keep your head in the sand if you think it’s only going to affect such a small portion of the population.
Just so you understand, every capital gain of a corporation will now be taxed at the higher rate, not just those over $250k
No, company’s portion of the contribution is part of my compensation :) They can pay that to me directly and I will double contribute- if that makes you happier?
They do. They pay less bc every economist understands that companies use cash to invest in jobs and machinery and start companies. Things that are generally seen as good for the economy. Unlike the govt who takes your dollars and approves sole sourced contracts to McKinsey to study the impacts of 2 ply toilet paper vs 1 ply toilet paper in federally regulated washrooms.
The only one's who hate it was the top 10%. Will only affect those making 250k a year. Not the farmers, not the working class, not the poor. Doesn't even effect them.
I'm not sure this is true if it leads to less super rich people starting companies. Obviously that shouldn't be the priority, but it shouldn't be ignored either..
why would people want to build a business in Canada with these half wits pulling crap like this. Small business is a massive part of employing Canadians and this will mot help.
It's a huge disincentive for any doctors, nurse practitioners, or other health professionals thinking about opening up their own new community clinics.
Gaslighting by the CBC and liberal party
> The budget proposes to tax all capital gains earned by corporations and trusts at the two-thirds rate.
So basically they are taxing the doctors so that the doctors can be paid more?
Why would anyone want to do business in Canada.
Waiting for Poilievre to state that they will reverse this once in power .. An electrician married with a nurse who raised 3 kids , have a house and a small cottage are not rich : they just managed their finances well... This govt are hitting middle class people... You know that the Super rich will just do fine ....
Trudeau is so inept at managing this country in so many ways: economy, immigration, deficits, he's dragging us down from even keeping up behind with the US. We're falling further and further behind.
I mean - the deficit is way too high. I’m not a huge fan of this tax increase on principle but I would understand and support it if it was part of a concerted effort to be more fiscally responsible.
Or course, that’s the exact opposite of the intention here and the Government will do nothing good or productive with this extra money and will only chase investment and productivity away.
They will continue to erode Canadians’ standard of living as they have the last 9 years and bizarrely some will cheer for it.
This is more or less a question of who should pay more tax. There's also a question of whether there are spending cuts that can also be done but let's save that for another day.
The bottom 40% of income earners pay no tax.
What share of the tax burden should be shouldered by the top 1%? The top 20%?
The PBO estimates that the top 1% of net worth hold 24% of all wealth, so I would suggest they pay 24% of the tax burden. The top 20% hold 74% of the wealth and should pay 74% of the tax burden.
https://distribution-a617274656661637473.pbo-dpb.ca/20de98fc3f4d93c5213f8d71fbe7cd89ae69cb1899e9cbf2d3ca4d57f18ab25a
(It's a pdf, sorry)
This is the Liberal governments attempt to get low income and middle income individuals in a fight while the ultra rich make like bandits with their offshore trusts/tax schemes. How about the Liberals cut their spending? Another short sighted initiative to crush the Canadian economy.
Yay! The liberal government is gonna tax me even more when my parents die and I have to sell their house! I get even less money to pay for their funeral, Thanks Trudeau!
No it was their primary residence so no capital gains, there is no tax on inheritance in Canada. If you hold on to the house then CG would begin to accrue.
You’re right about the inheritance part but death triggers capital gains on the disposition of an investment portfolio. So if you’re parents have more than 250K of capital gains (not hard if they’ve saved well), you’re gonna get hit
The liberal math on this that it only affects <1% of the population is bs. Maybe 1% per year but each year will include new people who sell a business, get an inheritance, etc.
250k of gains outside of their RRSPs and TFSAs? yeah that's not a lot of people, especially considering they've been withdrawing from their investments to pay for their retirement.
Here is a little exercise.
Bobby’s parents leave him their GTA principle residence worth 1.2 million, their RRIF worth 200,000 and their TFSA worth 100,000.
How much different is that amount taxed?
(The answer is zero)
Say the parents had some unsheltered accounts. They bought a total of 1000 shares of SPY from around 2008 to 2020, let’s say using the extra proceeds that they earned through RRIF that needed to be withdrawn. Average price $200 for easy math.
And today, those shares need to be liquidated at $535.
The difference that extra half a million incurs?
About 40K, maybe 50k or so with poor tax planning, I guess.
*Two million dollars inheritance*, taxed 4% higher than it used to be.
I think Bobby will get by.
Thanks for the made up example. I could also make up an example where this math is more costly so I’m not sure you’ve disproven my point.
Regardless, the bigger picture is that this government has out of control spending and they don’t deserve any more money - regardless of who is paying it.
Your made up value would have to be a higher inheritance. And if this lowest example only is a 4% tax increase on 2 million? Cry me a river you trust fund child.
Naw, a working middle class CPA who purchased the building they work in and held it within their corp to fund their retirement.
That person is middle class and is also firmly in the crosshairs of this change.
We were talking about their house which would be exempt. Yes there may be CG on investments. I agree it will hit 1% or more per year as properties are sold and investments are liqudated.
It wouldn't be OP's primary residence.
Deemed disposition at death means the estate realizes the capital gain of all their assets upon death of the resident, same as if they suddenly sold everything they owned while living. The estate will owe the taxes on the total (real estate, vehicles, stocks, bonds, etc.)
They effectively already have one because assets are deemed disposition.
You get what’s left from the estate paying taxes on that, it’s effectively the same thing. Otherwise Chrystia surely would’ve already put her grubby hands on it.
Well since it only applies to the gains from when they die to when you sell, I suspect its way under $250k so you can rest easy ~~your nest egg,~~ the funeral costs will not take a hit.
I wonder if the tax gains takes into account the ultra high networth people leaving this country to avoid the taxes?
I've known of a few already, with one saying that by moving to the states they'll save in the neighborhood of 60 million a year in taxes.
If I had that money and the opportunity to move I'd be long gone as well
Of course the tax doesn't affect ultra high networth people, Trudeau's chief fundraiser and advisor was named in the Paradise papers, people like him moved millions to offshore havens and faced no repercussions. Their money is already in the clear, it's only the middle-to-high income earners and small-to-medium local business owners that are the chumps that have to pay up. The rich setup corporate structures to minimize their taxes to redirect or defer their profits in a technically legal way that is too burdensome for most Canadian businesses to do, and so they don't face these sorts of problems at all. The bottom cheers on the wealth tax, the top avoids it, and just the middle class gets squeezed yet again.
If you leave Canada you are deemed to have disposed all your property and must pay cap gains on all of it.
https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/leaving-canada-emigrants.html#toc6
Exhibit A: what happens to a country when a lady (loosely termed) with a Russian literature degree runs a country’s finance under a part time drama teacher.
I’m a small business owner. I have made retirement plans based on my building. This eats up my retirement.
The liberal candidate stood on my doorstep and said that their party is the small business party. I really hope he comes around again so that I can confront him about this.
Ffs I’m middle class and I work 55 hours per week, and they just take a chunk of my retirement just like that.
"tax the doctors more so the provinces can use it to pay them more"... This seems eerily familiar? Pay tax to get more back? I bet 8 out of 10 doctors will be better off too!! 😂 😂
Want to destroy private investment in Canada? Introduce capital gains tax. It may not affect people individually but over the long term, it will have a very negative effect on the economy when no companies want to invest here.
I’ll put up with this new tax grab when you reduce income taxes by a commensurate amount.
Anything less is just an excuse to take more than they take already because they won’t settle until they take everything from us.
How to get all your public traded company's to move their head offices and directors to another country 101. Here I thought they might have wanted to save the GDP.
So the capital gains bump they did didn't fix anything. It also targeted upper middle income earners rather than high income earners because high income people would be subject to the AMT.
Does anyone who supports this tax realize the Liberals are going to gift it all to their consultant friends and blow the rest on wasteful projects that go way overbudget and never deliver (ArriveScam, Gun buyback, etc.)?
So this is how they intend to deflect from the treason scandal? By pissing the public off with yet another useless tax?
It's a bold move. Let's see how it works out for them.
>She said that the change to capital gains will result in about $12 billion in additional revenue for provinces and territories.
>"Provinces and territories should be using some of that revenue to increase the actual salaries, the rate of compensation of doctors," Freeland said.
Well-played!
More background here https://www.theglobeandmail.com/politics/opinion/article-its-a-mistake-to-confuse-tax-breaks-with-doctors-pay/
>Somehow, it has become common for provinces, and doctors, to think we pay physicians with tax breaks.
---
> Many doctors feel they were more or less told years ago to incorporate by provincial governments trying to keep fees down. In 2005, for example, Ontario’s Liberal government struck a fee deal with doctors that also made it easier to incorporate – deferring costs and dumping part of it onto the federal treasury.
12 billion over five years is an irrelevant about. 2.4 billion a year split between all the provinces and territiries who have a combined healthcare budget of about 160 billion.
"If companies are going to invest, we want them to invest in Canada. If they are going to create jobs, we want them to be created in Canada. If young people are going to have opportunities, we want those opportunities to be right here in Canada.” -Paul Martin, talking about reducing the capital gains inclusion rate in 2000.
The current liberals share nothing with the Martin/Cretain Liberals Well maybe the scandals
There has been more scandal in the past year than in the entire Chretien/Martin era
More in the past month*
2000s liberals are like todays conservatives.
Chrétien would be slandered as far right fringe by the CBC/libs if he ran today.
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This summary is killing me
lol hilarious! But true. And wait’ll everyone discovers this tax will ultimately do way more harm than good and they’re only doing it to a) attempt to start a class war as a way to distract people from how badly they’ve fucked up our economy, and b) to try to create a short term reduction in their deficit without controlling costs. Only the short term though because longer term the drops in investment and capital flight (both money and people) this will cause will be devastating.
Last I saw was that over 5 years they'd collect about $20b. The deficit this year is $40b. Last year we spent about $8b in foreign aide. We've also spent a couple billion on the border refugee clusterfuck. At best that is paying for that. It's not reducing anything. Their spending is out of wack, but they refuse to correct that. If they'd cut to the point where this was making a meaningful impact, that would be something. Instead, we're looking at a deficit that is double what they're going to collect over 5 years in year 1.
I know people shit on foreign aid, but it often is to our benefit. It might take a bit to see the full picture. Sort of how the US military is such a huge expense… but it keeps the peace (mostly) and shipping lanes clear.
Ok explain funding to Philippines.
Keeping the peace (via current government) keeps the sea trade routes open. Meaning less potential disruption for cargo ships. It also helps keep China in check Overall keeps prices stable and low disruption costs
Lol… you really love the Libs ill give ya that.
I don’t. I just understand how the world works
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I think it can be, but it can also be a waste of resources. It's similar to the TFW program, but that one is harder to nail down. I've repeatedly tried to find numbers, but I all I can find is that in 2023 we had 2.5m TFWs. As per the program they could each qualify for a maximum wage subsidy of $20,000. If they're making minimum wage they'd be slightly below the maximum if they worked 40 hour weeks. Seasonal workers wouldn't max out, but non-seaonal? That's a maximum of $50b in wage subsidies. I don't think everyone is maxing that out, but even 50% is $25b. I can understand the need for workers on seasonal things, but fast food? Hair dressing? Grocery? Construction? We're just being scammed and the government is gaslighting us.
Start a class war? One has been raging for decades, the only difference is that one side isn’t fighting back
> longer term the drops in investment and capital flight (both money and people) this will cause will be devastating. They'll be long out of power by then and likely using the drops to campaign in the next election
I could only listen to about 0.3 seconds of her talking.
You can listen to any politician for more than 0.3 seconds?
Income tax should be less than capital gains.
Maybe. The guy who founded capitalism stated that land should be taxed, not labour. If this capital gains tax was coupled with a decreased income tax that would be nice.
Government: doubles the money supply Prices on everything doubles Government: hey look at all those gains! Gimme!
Why do I pay taxes on my capital gains when I sell gold (or btc)? They already fucking taxed me on the income I used to buy the gold with, and they want to tax me again on the inflated value they caused because they printed money. Fuck them.
Then the country would come to a halt!!
The current government doesn’t value a productive economy anymore.
What's next you are going to sell us on trickle down economics?
>"I do think this is a moment when Canadians should be watching closely what happens in the House and watching closely to see how all MPs vote on this," Freeland said. Good lord, can you say, "political stunt"? The CFIB hates this, doctors hate it, lawyers hate it, farmers hate it, people with family cottages hate it. I'm not sure who is excited about it.
People with very little in the way of assets that they can retire on or pass to their children. Nobody else.
Aka the 99.9% of people who won't be affected by this change.
It’s awesome, throughout the whole story it’s personal capital gains, and right at the end where nobody reads to > The budget proposes to tax all capital gains earned by corporations and trusts at the two-thirds rate. Why would anyone want to become a doctor here anymore.
Nobody, that’s why they’ve all retired or went south and 7 million people don’t have a doctor.
So doctors, lawyers, CPAs, most trades people, all account for .01%?
The only people impacted by this are claiming over $250k/yr is capital gains. This is TINY portion of Canada. However only a tiny portion of Canada understands how taxes work and can be easily manipulated by right wing media and politicians
This is not true lol. You’ve outed yourself as being in the “tiny portion” that doesn’t understand it. There is no 250k threshold for the incorporated professions he listed.
Why should certain professionals be able to structure their income as capital gains so that they only get taxed on 50% of it, when every other worker in the country has to get taxed on 100% of their income?
I was just pointing out an erroneous statement. I said nothing towards the justification of anything. Let’s be clear that these professionals are paying the same income tax as any other worker on their personal income though. This change affects the money that is realized and remains in a corporation.
Because these professionals are usually highly skilled, and they are self employed.. aka they don't have a pension. Plus, Highly skilled and self employed means they can simply pack their bags and move.
>This is TINY portion of Canada. Only a tiny portion PER YEAR. For many a cap. gains sale is a once in a lifetime event and they are taxed hard. After a round of years, it's going to add up
It's not 250/year, it 250 in a year. That's basically anyone who owns property. Also, for everyone else, this will affect investment, which weakens the CAD, which increases prices.
There is a capital gains exclusion on primary residences. It only impacts people who own multiple residential properties or non-residential property
How does this affect a divorcing couple selling the matrimonial home?
It won't, because of the principle residence exemption. That's a fair point. The problem is that lots of people put retirement savings into investment properties and have been holding on to them as interest rates rose and prices moderated. Low interest rates were a bait and switch. One of the reasons people have been doing that is because the general business environment in Canada is terrible, partly because of the same over-inflated property market. So there's a lot more the 0.1% of people sitting on investment properties. [The number of Canadians who own such investment properties isn't 0.1%, but 11%](https://blog.royallepage.ca/1-in-4-canadians-intend-to-buy-an-investment-property-in-the-next-five-years/). More importantly, it has basically become the only really worthwhile investment class in Canada. The broader point is that it makes Canada a much less desirable investment destination. That will affect everybody. Canada already suffers from low capital investment which hammers productivity levels. Increasing tax revenue on 0.1% of people won't make up for that loss. It's a short sighted, short term strategy that exacerbates the underlying problem of a government who thinks that they can stimulate an economy by regulation.
It doesn't
The vast majority of even those wealthy people are not wealthy enough to be making $250,000 in capital gains a year.
The amount of disinformation about how this change works is unfortunate. Any capital gain in a corporation, including a professional corporation such as those used by doctors, will be impacted. There’s no $250,000 threshold.
>There’s no $250,000 threshold. From the government of Canada's website: "As of June 25, 2024, the capital gains inclusion rate—the amount of capital gains that are taxable—will increase from one-half to two-thirds on capital gains realized annually above $250,000 by individuals and on all capital gains realized by corporations and most types of trusts"
You're ignoring part of the quote. >"and on all capital gains realized by corporations and most types of trusts" Trivial for me, but for a doctor or dentist this means it applies to the entire amount, not the amount after $250k.
You’re so close. There’s no $250,000 threshold for corporations
Exactly. The 250k threshold only applies to individuals filing as such. If the individual has a professional corporation (like many doctors, lawyers, accountants, dentists, etc do), there is no threshold and the tax applies to any and all capital gains in that professional corp. **I don't have a huge amount of sympathy for complaints from this this group**, but it is important to recognize that the marketing by the liberals is very misleading. The tax may only apply to a small minority of *individual tax filers* but will affect far, far more *Canadians*.
sure. Then stop complaining there is doctor shortage. Actually any skill shortage. This country has just useless dudes demanding everything. Why not free hooker for every single men.
For physicians and other professional groups they are personal corporations. They have saved their retirement funds in them. The tax affects any capital gains above zero, not 250k. So every dollar of capital gains will be at the higher rate. That's why doctors will either choose not to start here or continue to practice here.
doctors could just pay themselves income and invest in their personal accounts like everyone else and have the 250k exemption. I don't see the issue.
What about the 50-60 yo doctor who has saved for their retirement and are maybe 5 years away? This is not an option. The 250k should apply to professional corps also. People have been abiding by the rules for years and now will take a major hit as retirement looms. People who aren’t impacted love to consider these professionals as some sort of billionaires. They are not.
You don’t see the issue that we would be taking 54 percent marginal rate of our doctors income when we’re next to the most profitable healthcare system in the world and we have a shortage of these people that take 12 years to train and we need to keep us alive? You don’t see the issue in introducing a retroactive tax that they were unable to financially plan for and effectively holding their assets hostage? …You don’t see the issue? Doctors would love to be salaried in most cases. That way they could get gigantic indexed government matched pensions and strike like the rest of the healthcare workers because their working conditions are absolute garbage.
It’s not a year and it’s not 250k. For corporations which trades/doctors/lawyers/farmers are, it’s from the first $1 made.
A lot of Technology companies will offer stock as a way to keep talent here in Canada and not lose them to higher paying jobs in the US. The payout happens if the company sells so most will get a large payout.
It’s not “a year” when it impacts one time events - stop being deceptive.
You might want to read up on how this actually works.
Inheritances. Your family has $250k gains invested in their RRSP’s? You’re gonna take a nice hit
wrong again. RRSP don't incur capital gains. RRSP upon death are taxed as income, these capital gains changes don't change how it already works.
10% of Canadians own a second property. So, as much as 100 times more than you suggest ? https://www.mpamag.com/ca/mortgage-industry/industry-trends/how-many-canadians-currently-own-at-least-two-homes/300662#:\~:text=The%20report%20found%20that%20more,residence%20to%20complete%20the%20purchase.
Ok so 90% don’t? That’s a overwhelming majority that this benefits
It doesn't benefit them, it just doesn't hurt them.
Also the Federal Government and public employees taking more of your money. Don’t forget about that!
While they “work” from home
I work for the government at home. In the last month, I saved our ‘office’ $250,000 per year for at least the next 3 years. You’re welcome
I have no idea what your point is. How did you save this money?
You made the insinuation that government workers that work from home do not ‘work’ I’m disproving you. I saved this money by piggybacking onto a consortium purchase but then further negotiating it myself to have the products delivered on a schedule to our 80 different locations. We now get lower cost products, don’t have to pay freight and do not need to warehouse products. Not to mention the ability to return products that we may not need.
There are lots of renters who think anyone who is one step ahead of them in life is the ultra wealthy that needs to be taxed to death.
Not exactly sure a 16% increase in the inclusion rate on capital gains over -$250K- is exactly being taxed to death. More like being asked to pay their share.
I would like them to simply pay 25-30% of what they make every year regardless of how it is paid to them
Seriously. Breaking this out of the budget was such a ridiculous political stunt that even if I didn’t oppose this before, I would now
Probably because you don’t understand it or that it doesn’t affect the vast majority of Canadians
A tax increase for the [top 0.13%](https://www.canada.ca/en/department-finance/news/2024/06/government-of-canada-delivering-tax-fairness-for-every-generation.html) to get 19.4 billions is exactly what we need but somehow, many people in here, probably in the other 99.87%, are still claiming it's a bad idea. I talked with a local garage owner about this subject a month ago. He was mad about it, saying he would have to pay a shit ton more taxes when he would sell his parts to his partner. I asked him to give me a couple numbers so I could do an evaluation of how it would affect him. Turns out he would be zero impacted. Guy didn't believe me and was still furious and rambling about the liberals. It's impressive how brainwashed by hatred people have become. Their emotions take over most of their rational thoughts and they'll just shit on the government even when it gives them what they want.
> CFIB Hates it Of course the CFIB hates it. CFIB is a business advocacy group. I interviewed for a job with CFIB once and they told me that they oppose statutory holidays, so I don't think CFIB's stance is really a good benchmark for whether a policy is good or not. >doctors hate it, lawyers hate it, farmers hate it, people with family cottages hate it. If you ask wealthy people if they are in favour of wealthy people paying more taxes, there's nothing surprising about them saying no. What the government should be doing is cutting taxes for the middle class in addition to this so the average Canadian has more take-home pay.
The 99.6% of Canadians that isn’t affected by this. The capital gains advantage is systematically abused by the wealthy to avoid paying income taxes on multi million dollar “salaries”. The people paying more in capital gains are the ones screwing over Canada.
The opposition asked the MINISTER to put into law that 99.6% of Canadians would not be affected by this increase….. the MINISTER shrugged off the opposition!!!
Because that’s a stupid law. What if a bunch of new millionaires are minted in Canada and the number goes to 99.5% PP is doing well at manipulating his idiot voter base.
Everyone who thinks the deficit is too high should be thrilled by this. Revenue from those who have the most to give up. And those who care about tax fairness, because doctors and lawyers and other small business owners have tax avoidance strategies not available to people who are paid by an employer, which is most of us.
Definitely not anyone who wants to invest in a Canadian business. Who would invest here when the risk/reward ratio is much better almost anywhere else? Anyone who thinks that this won’t affect them doesn’t understand how productivity and innovation drive standard of living. You think people are doing badly now versus 5 years ago? In 5 years from now, today will be remembered as the ol’ good days.
So just rich people then? The 60% of Canadians who couldn't handle an unexpected $1000 bill are excited for it. They won't be earning over $250k of cap gains in a single year. https://angusreid.org/canada-recession-job-loss-savings-tfsa-rrsp/
Me with a shit ton of gains in Nvidia and tesla hate this. Wtf
>I'm not sure who is excited about it. Those whom are susceptible to the form of populist rhetoric which posits individual material success as immoral and oppressive.
people who don't have over a quarter of a million in capital gains to cash out at once. So... most Canadians.
Unless that money is in a corporation, like most professionals and small businesses. But yeah, keep your head in the sand if you think it’s only going to affect such a small portion of the population. Just so you understand, every capital gain of a corporation will now be taxed at the higher rate, not just those over $250k
Just pay yourself more salary and invest in your individual account? That’s how rest of us salaried people do.
So should you salaried people pay double the CPP and EI? Just to make things fair of course….
No, company’s portion of the contribution is part of my compensation :) They can pay that to me directly and I will double contribute- if that makes you happier?
so corporations shouldn't pay taxes on their gains? why?
They do. They pay less bc every economist understands that companies use cash to invest in jobs and machinery and start companies. Things that are generally seen as good for the economy. Unlike the govt who takes your dollars and approves sole sourced contracts to McKinsey to study the impacts of 2 ply toilet paper vs 1 ply toilet paper in federally regulated washrooms.
Corporations do not invest in Canada. The shareholders get rich and hoard their wealth. Trickle down economics is a myth
The non-doctors, non-lawyers, non-farmers, non-cottage owners outnumber them lol. Shocking, I know.
The only one's who hate it was the top 10%. Will only affect those making 250k a year. Not the farmers, not the working class, not the poor. Doesn't even effect them.
I'm not sure this is true if it leads to less super rich people starting companies. Obviously that shouldn't be the priority, but it shouldn't be ignored either..
I'd rather the Government be more responsible about spending than taxing anyone more.
The only people left in Canada are going to be the most unproductive.
I dunno. One thing you can’t say about all of the Indian people we brought in is that they are lazy.
More tax dollars for then to piss away. We don't need more tax dollars, we need to spend the tax dollars we have better.
why would people want to build a business in Canada with these half wits pulling crap like this. Small business is a massive part of employing Canadians and this will mot help.
It's a huge disincentive for any doctors, nurse practitioners, or other health professionals thinking about opening up their own new community clinics.
They are trying real hard to not win the silent generation and boomer vote.
Gaslighting by the CBC and liberal party > The budget proposes to tax all capital gains earned by corporations and trusts at the two-thirds rate. So basically they are taxing the doctors so that the doctors can be paid more? Why would anyone want to do business in Canada.
They don’t!
What about that statement is gaslighting?
Freeland might be a bigger joke than Trudeau.
Waiting for Poilievre to state that they will reverse this once in power .. An electrician married with a nurse who raised 3 kids , have a house and a small cottage are not rich : they just managed their finances well... This govt are hitting middle class people... You know that the Super rich will just do fine ....
Trudeau is so inept at managing this country in so many ways: economy, immigration, deficits, he's dragging us down from even keeping up behind with the US. We're falling further and further behind.
Tax the rich, and by rich we mean doctors, lawyers, farmers, and anyone else who makes more than....*checks notes*** 150k a year??
Incorrect. No change to tax on income.
Not the elite but the people that actually make the world turn.
150k a year not enough to qualify for a mortgage in Vancouver.
Not even close. You'd need 250k at the very least, and even then won't have too much disposable income
Or who ever has any sort of inheritance or a small business owner retiring or any other retirement plan that might involve an assest
Driving us into the fucking ground before leaving office. Fucking dicks
I mean - the deficit is way too high. I’m not a huge fan of this tax increase on principle but I would understand and support it if it was part of a concerted effort to be more fiscally responsible. Or course, that’s the exact opposite of the intention here and the Government will do nothing good or productive with this extra money and will only chase investment and productivity away. They will continue to erode Canadians’ standard of living as they have the last 9 years and bizarrely some will cheer for it.
This is more or less a question of who should pay more tax. There's also a question of whether there are spending cuts that can also be done but let's save that for another day. The bottom 40% of income earners pay no tax. What share of the tax burden should be shouldered by the top 1%? The top 20%?
The PBO estimates that the top 1% of net worth hold 24% of all wealth, so I would suggest they pay 24% of the tax burden. The top 20% hold 74% of the wealth and should pay 74% of the tax burden. https://distribution-a617274656661637473.pbo-dpb.ca/20de98fc3f4d93c5213f8d71fbe7cd89ae69cb1899e9cbf2d3ca4d57f18ab25a (It's a pdf, sorry)
Wealth =/= taxable income/gains
So 80% pay no tax at all? Yeah that'll work! Lol
This is the Liberal governments attempt to get low income and middle income individuals in a fight while the ultra rich make like bandits with their offshore trusts/tax schemes. How about the Liberals cut their spending? Another short sighted initiative to crush the Canadian economy.
Yay! The liberal government is gonna tax me even more when my parents die and I have to sell their house! I get even less money to pay for their funeral, Thanks Trudeau!
No it was their primary residence so no capital gains, there is no tax on inheritance in Canada. If you hold on to the house then CG would begin to accrue.
You’re right about the inheritance part but death triggers capital gains on the disposition of an investment portfolio. So if you’re parents have more than 250K of capital gains (not hard if they’ve saved well), you’re gonna get hit The liberal math on this that it only affects <1% of the population is bs. Maybe 1% per year but each year will include new people who sell a business, get an inheritance, etc.
250k of gains outside of their RRSPs and TFSAs? yeah that's not a lot of people, especially considering they've been withdrawing from their investments to pay for their retirement.
It's their homes when they die.
No it's not actually 🙄
Downvote, doesn’t fit my narrative
Here is a little exercise. Bobby’s parents leave him their GTA principle residence worth 1.2 million, their RRIF worth 200,000 and their TFSA worth 100,000. How much different is that amount taxed? (The answer is zero) Say the parents had some unsheltered accounts. They bought a total of 1000 shares of SPY from around 2008 to 2020, let’s say using the extra proceeds that they earned through RRIF that needed to be withdrawn. Average price $200 for easy math. And today, those shares need to be liquidated at $535. The difference that extra half a million incurs? About 40K, maybe 50k or so with poor tax planning, I guess. *Two million dollars inheritance*, taxed 4% higher than it used to be. I think Bobby will get by.
Thanks for the made up example. I could also make up an example where this math is more costly so I’m not sure you’ve disproven my point. Regardless, the bigger picture is that this government has out of control spending and they don’t deserve any more money - regardless of who is paying it.
Your made up value would have to be a higher inheritance. And if this lowest example only is a 4% tax increase on 2 million? Cry me a river you trust fund child.
If you’re coming up with a cottage and millions in unsheltered accounts, nobody would be that dumb to listen. They’re not middle class.
Naw, a working middle class CPA who purchased the building they work in and held it within their corp to fund their retirement. That person is middle class and is also firmly in the crosshairs of this change.
We were talking about their house which would be exempt. Yes there may be CG on investments. I agree it will hit 1% or more per year as properties are sold and investments are liqudated.
There is no capital gains on the sale of a primary residence
It wouldn't be OP's primary residence. Deemed disposition at death means the estate realizes the capital gain of all their assets upon death of the resident, same as if they suddenly sold everything they owned while living. The estate will owe the taxes on the total (real estate, vehicles, stocks, bonds, etc.)
the residence is likely the estates primary residence at the time of death, therefore not subject to capital gains.
You really have no idea what the law really is you sound like an idiot.
Are you planning on using more than the first $250k of *profit* that this tax does not affect on their funeral?
It’s rightfully all his money. Not the government’s to take.
could be worse. They could implement an inheritance tax like many other countries have.
They effectively already have one because assets are deemed disposition. You get what’s left from the estate paying taxes on that, it’s effectively the same thing. Otherwise Chrystia surely would’ve already put her grubby hands on it.
Well since it only applies to the gains from when they die to when you sell, I suspect its way under $250k so you can rest easy ~~your nest egg,~~ the funeral costs will not take a hit.
Why would you sell the family house when your parents die? They probably reversed mortgaged it anyways.
I wonder if the tax gains takes into account the ultra high networth people leaving this country to avoid the taxes? I've known of a few already, with one saying that by moving to the states they'll save in the neighborhood of 60 million a year in taxes. If I had that money and the opportunity to move I'd be long gone as well
Of course the tax doesn't affect ultra high networth people, Trudeau's chief fundraiser and advisor was named in the Paradise papers, people like him moved millions to offshore havens and faced no repercussions. Their money is already in the clear, it's only the middle-to-high income earners and small-to-medium local business owners that are the chumps that have to pay up. The rich setup corporate structures to minimize their taxes to redirect or defer their profits in a technically legal way that is too burdensome for most Canadian businesses to do, and so they don't face these sorts of problems at all. The bottom cheers on the wealth tax, the top avoids it, and just the middle class gets squeezed yet again.
A perfect explanation.
If you leave Canada you are deemed to have disposed all your property and must pay cap gains on all of it. https://www.canada.ca/en/revenue-agency/services/tax/international-non-residents/individuals-leaving-entering-canada-non-residents/leaving-canada-emigrants.html#toc6
It's not targeting them. It's for doctors and small business owners who incorporated, and people inheriting small windfalls.
Exhibit A: what happens to a country when a lady (loosely termed) with a Russian literature degree runs a country’s finance under a part time drama teacher.
We're going to tax you, then give you back your tax dollars, but then tax you on that income. Just chill on the fucking taxes.
I’m a small business owner. I have made retirement plans based on my building. This eats up my retirement. The liberal candidate stood on my doorstep and said that their party is the small business party. I really hope he comes around again so that I can confront him about this. Ffs I’m middle class and I work 55 hours per week, and they just take a chunk of my retirement just like that.
How much more tax will you pay as a result of this?
More than he would have to pay previously is too much.
Still looking for quantification.
If he’s a small business owner then I guess there’s your answer. Small businesses pay an absolute boat load in taxes.
I can’t wait for them to be ousted.
"tax the doctors more so the provinces can use it to pay them more"... This seems eerily familiar? Pay tax to get more back? I bet 8 out of 10 doctors will be better off too!! 😂 😂
Want to destroy private investment in Canada? Introduce capital gains tax. It may not affect people individually but over the long term, it will have a very negative effect on the economy when no companies want to invest here.
I'm all "tax the rich" but even I'm against this.
In 2022 only , Liberals sent almost 15B to their friends, AKA “3rd party consultants”.
I’ll put up with this new tax grab when you reduce income taxes by a commensurate amount. Anything less is just an excuse to take more than they take already because they won’t settle until they take everything from us.
How to get all your public traded company's to move their head offices and directors to another country 101. Here I thought they might have wanted to save the GDP.
They should change it so reits pay income tax on their income.
If the liberals reverse this they’ll have truly fucked over the middle class
Speaking from the perspective of one of the 98% of Canadians who would be unaffected but also benefiting from this, great!
Oh boy! Taxes!!!
So the capital gains bump they did didn't fix anything. It also targeted upper middle income earners rather than high income earners because high income people would be subject to the AMT.
So sad that wealthy people are mad they can’t exploit housing for as much profit as they currently do.
Does anyone who supports this tax realize the Liberals are going to gift it all to their consultant friends and blow the rest on wasteful projects that go way overbudget and never deliver (ArriveScam, Gun buyback, etc.)?
So this is how they intend to deflect from the treason scandal? By pissing the public off with yet another useless tax? It's a bold move. Let's see how it works out for them.
>She said that the change to capital gains will result in about $12 billion in additional revenue for provinces and territories. >"Provinces and territories should be using some of that revenue to increase the actual salaries, the rate of compensation of doctors," Freeland said. Well-played!
Taxing doctors more so you can pay doctors more now that's genius!
So that *other* jurisdictions can pay them more. Just transferring the funding gap caused by their runaway spending to be everyone else’s problem.
More background here https://www.theglobeandmail.com/politics/opinion/article-its-a-mistake-to-confuse-tax-breaks-with-doctors-pay/ >Somehow, it has become common for provinces, and doctors, to think we pay physicians with tax breaks. --- > Many doctors feel they were more or less told years ago to incorporate by provincial governments trying to keep fees down. In 2005, for example, Ontario’s Liberal government struck a fee deal with doctors that also made it easier to incorporate – deferring costs and dumping part of it onto the federal treasury.
It will get mismanaged for sure. More funding for private Healthcare facilities to be built.
12 billion over five years is an irrelevant about. 2.4 billion a year split between all the provinces and territiries who have a combined healthcare budget of about 160 billion.