13.75°C Vancouver

Jun 25, 2024 6:24 PM - The Canadian Press

Liberal government's proposed capital gains tax changes come into effect today

Share On
liberal-governments-proposed-capital-gains-tax-changes-come-into-effect-today
For individuals' capital gains of $250,000 or less, the inclusion rate would remain the same, at 50 per cent.(Photo: The Canadian Press)

The Liberal government's changes to capital gains taxation came into effect Tuesday, despite significant pushback from business and physicians' groups.

Finance Minister Chrystia Freeland's spring budget proposed making two-thirds of capital gains the profit made on the sale of assets such as a secondary residence or stocks taxable, rather than one-half.

For individuals' capital gains of $250,000 or less, the inclusion rate would remain the same, at 50 per cent.

At a time when the Liberals are looking to woo back young voters, Prime Minister Justin Trudeau has pitched the effective tax increase as a way to deliver generational fairness.

The Liberal government says the $19.4 billion it expects to raise in five years due to the changes will help pay for housing and other priorities for young people.

Freeland introduced a standalone motion on the changes, which easily passed the House of Commons earlier this month.

The NDP, Bloc Québécois and Greens voted with the Liberals in favour of the motion while the Conservatives, who had been silent on the tax changes until then, voted against it.

Conservative Leader Pierre Poilievre insisted the wealthy will find ways to move their money out of Canada to avoid paying the tax, which will negatively affect farmers, small businesses, doctors and homebuilders.

The changes have sparked backlash from business groups who say that the higher inclusion rate will hurt the economy by lessening competition and innovation.

Physicians' groups have spoken out against it as well, noting that many doctors have used their incorporated medical practices to invest and save for retirement.

But the Liberals have brushed off the opposition, arguing that only a small portion of wealthy Canadians will face a higher tax bill.

During a speech earlier this month, Freeland questioned Canada's wealthiest on what kind of country they want to live in. The finance minister painted a bleak picture of the alternative to hiking taxes and increasing spending on health care and social services.

"Do you want to live in a country where those at the very top live lives of luxury, but must do so in gated communities behind ever-higher fences using private health care and airplanes because the public sphere is so degraded and the wrath of the vast majority of their less privileged compatriots burns so hot?" Freeland said.

Ottawa estimates that in any given year, 0.13 per cent of Canadians would pay higher taxes on their capital gains.

To encourage entrepreneurship, the government is also proposing the Canadian Entrepreneurs' Incentive, which will reduce the inclusion rate to a third on a lifetime maximum of $2 million in eligible capital gains.

A statement by The International Monetary Fund on June 11, written by IMF staff after concluding a regularly scheduled visit to Canada, was quietly positive about the capital gains change.

The preliminary concluding statement said the change "improves the tax system’s neutrality with respect to different forms of capital income and is likely to have no significant impact on investment or productivity growth."

Latest news

quebec-plans-new-law-to-ban-religious-symbols-in-daycare-centres
CanadaOct 23, 2025

Quebec plans new law to ban religious symbols in daycare centres

The Quebec government is moving to prohibit the wearing of religious symbols in the province’s daycare centres, expanding its existing secularism policies in early childhood settings. Secularism Minister Jean-François Roberge said there is broad public agreement that Quebec’s commitment to secular values should be reinforced. The decision follows recommendations made earlier this year by a provincial advisory committee that studied ways to strengthen secularism laws. Quebec’s current legislation already restricts public employees in positions of authority, including teachers, police off
alberta-government-plans-back-to-work-legislation-as-teachers-strike-enters-third-week
AlbertaOct 23, 2025

Alberta government plans back-to-work legislation as teachers’ strike enters third week

Alberta Premier Danielle Smith says her government will introduce back-to-work legislation on Monday if no deal is reached to end the provincewide teachers’ strike. Smith said the walkout, now in its third week, has caused “intolerable hardship” for students and families, adding that the government cannot allow the disruption to continue. The strike has shut down classrooms for about 51,000 teachers and 750,000 students in public, separate, and francophone schools across the province. While formal negotiations between the Alberta Teachers’ Association and the province are not currently
superintendent-peri-mainwaring-appointed-new-head-of-north-vancouver-rcmp
BCOct 23, 2025

Superintendent Peri Mainwaring appointed new head of North Vancouver RCMP

The North Vancouver RCMP has a new Officer-in-Charge. Superintendent Peri Mainwaring has been appointed to lead the detachment, bringing more than three decades of policing experience with the RCMP. Mainwaring began her career in Saskatchewan and has served in municipal, provincial and federal roles across the country. Before her latest promotion, she was the Community Programs Officer with the Burnaby RCMP, where she helped strengthen community safety initiatives and led work on mental health and crisis intervention. Her connection to North Vancouver is longstanding — Mainwaring previously
pm-modi-invites-canadian-pm-to-new-delhi
CanadaOct 23, 2025

PM Modi invites Canadian PM to New Delhi

India has invited Prime Minister Mark Carney to New Delhi early in the new year for talks with Prime Minister Narendra Modi. This could pave the way for a new economic relationship and a free trade agreement between the two countries. India's High Commissioner to Canada Dinesh Kumar Patnaik said that a sincere effort is being made by the two leaders to improve diplomatic relations and increase trade and investment opportunities amid the tariff war with the US. Patnaik said that if the two countries negotiate a far-reaching agreement, annual trade between Canada and India could cross $50-billio
interior-health-testing-virtual-emergency-care-to-support-rural-hospitals
BCOct 23, 2025

Interior Health testing virtual emergency care to support rural hospitals

Interior Health is planning a pilot project that would use virtual emergency care to help keep small hospitals in British Columbia’s Interior open during staffing shortages. The proposal would link hospitals in Clearwater, Nakusp, Lillooet, and Princeton, allowing physicians to share responsibilities through a combination of on-site and remote support. Interior Health says the four facilities face similar challenges, with low overnight patient volumes but frequent service interruptions due to limited staffing. The health authority says it is consulting with local doctors and staff to determi

Related News