Increasing Capital Gains Inclusion Rate Not the Answer

Beth Graddon

In one of our most popular polls to date, the “no” side is winning the opinion poll; but it is in their comments that some astute insights are emerging.  What’s your take on this question: “In the last election, some parties suggested an increase to the capital gains inclusion rate to 75% or more as the best way to raise new money to pay down the government debt. Do you agree?”. Here is just some of the feedback shared so far:

“Definitely NO, this would have a very serious effect on seniors.  With interest rates so low, seniors have had to move into stocks to get any returns.  If the government cannot spend less they should apply a very small tax to the ultra wealthy.” – Nancy Campbell

“Reduce government spending on wages to MPs & Senators.  NZ has just reduced theirs by 20% in empathy with the reduced incomes of their citizen voters. Produce incomes from selling or renting many now less-used buildings; act like private owners. Cut ALL advertising by 20%.  Stop pretending it's for public good when it's vote -fishing. Maybe fund independent non-partisan long-term analysts to approve federal ads.” – Denzil Feinberg

“I disagree. I have been a cottage owner for 40+ years and seen a modest increase in value. I think (cottage owners) should be allowed to exclude the first $200,000 value. . .” – Richard

“No, the current 50% deal on capital gains inclusion in income seems reasonable to most Canadian investors. A higher rate of 75% would likely discourage investments and push investors to invest in other jurisdictions offering better deals. Although the greatest winners are the wealthy which inspires the idea to raise more tax revenues on capital gains, the long run costs to the country would outweigh the benefits.” – Trevor Hitchman

What are your thoughts on this important topic? Weigh in before the month is through!