The government of Canadian prime minister Justin Trudeau is planning to increase the share of capital gains tax paid to 66% for individuals with annual investment profits in excess of CAD 250,000 (GBP 145,000). Companies and trusts are also going to fall into the new tax regime, according to budget details published last month.
Canada’s finance minister, Chrystia Freeland, has proposed hiking CGT on both companies and individuals from the current 50% to two thirds. She is arguing the tax will only really affect 0.13% of Canadian private citizens and around 12% of businesses, although some local business groups beg to differ.
The change is expected to bring in another CAD 19.4bn (GBP 11.3bn) into the public coffers over a five year period. The changes were not included in the main Canadian budget and will be brought into being using separate legislation.
Why are the Canadian CGT changes bad for Canadian resources companies?
The…
