Examples include a family inheriting a farm or recreational property, or a small business owner retiring or selling for personal reasons

View this email in your browser ([link removed])
If you follow the news from Ottawa, you may know that the Liberal government, backed by the Federal NDP, plans to increase the capital gains tax. This news might not affect most people, but it could be problematic for some, particularly farmers, doctors and small business owners who rely on capital gains for their retirement.

In basic terms, capital gains tax is a tax levied on the profit you make from selling certain types of assets or properties in Canada, such as stocks, bonds, precious metals, or certain real estate. This tax only applies when you sell these items. The "inclusion rate" applies to the profit from the sale of these assets. Some or all of the profit from a capital gain is limited by this rate. For example, a home designated as a "principal residence" is exempt from capital gains tax.

Many non-exempt assets are subject to a capital gains tax, which is currently applied to 50% of sale profits. The Trudeau Liberals propose increasing the inclusion rate to 67% for individuals with over $250,000 in capital gains in a tax year, and for many corporations and most trusts.

To clarify, someone in this situation would not pay a 67% tax rate on capital gains. Instead, 67% of the profit from a sale could be subject to capital gains tax. This gain would be reported on their taxes, and 67% of their profit from the sale would be added to their income for tax calculation.

According to the Trudeau Liberal government, this capital gains tax increase will only affect "multimillionaires" and Canada's wealthiest individuals. However, this statement doesn't provide the full picture. Economist Jack Mintz has pointed out that many Canadians may face a capital gains tax due to an uncommon event, and that about 80% of people experience large capital gains only once or twice, suggesting that those who experience capital gains in a given year usually have middle or modest income in other years.

Examples include a family inheriting a farm or recreational property, or a small business owner retiring or selling for personal reasons such as health or marriage. The Canadian Medical Association opposes this tax increase, stating that changes to the capital gains inclusion rate will impact community-based physicians and affect their retirement savings, creating more obstacles to keeping and attracting physicians in Canada.

The Conservative Party, for its part, opposes this tax increase. In the words of Opposition Leader Pierre Poilievre, “Trudeau is increasing taxes on home construction during a housing crisis, on doctors when we have a shortage, on farmers as food costs soar, and on small businesses when Canadian salaries are decreasing." He also shared thoughts on simplifying and improving the fairness of our tax system and reducing taxes for low- to middle-income earners. I'll cover this more in another MP report.

I'd like to ask you: Will you or someone you know be impacted by an increase in the capital gains tax inclusion rate, and do you support or oppose it? Why or why not?

You can reach me at [email protected] (mailto:[email protected]) or call toll-free 1-800-665-8711.

============================================================
** Twitter ([link removed])
** Facebook ([link removed])
** Instagram ([link removed])
** Website ([link removed])
** Email (mailto:[email protected])
Dan Albas is the Member of Parliament for the riding of Central Okanagan-Similkameen-Nicola and the Co-Chair of the Standing Joint Committee for the Scrutiny of Regulations. In addition, Dan co-chairs an All-Party Parliamentary Cancer Caucus. Dan's riding includes the communities of Kelowna (specific boundaries), West Kelowna, Peachland, Summerland, Keremeos, Hedley, Princeton, Merritt and Logan Lake.
You can reach Dan by calling 1-800-665-8711 or visit: DanAlbas.com
Our mailing address is:
Dan Albas MP
101-3771 Old Okanagan Hwy
West Kelowna, British Columbia V4T 1K7
Canada

Want to change how you receive these emails?
You can ** update your preferences ([link removed])
or ** unsubscribe from this list ([link removed])
.
Email Marketing Powered by Mailchimp
[link removed]