Federal Government Announces Changes to Capital Gains Taxation
Fairer Tax System on the Horizon
Proposed Changes to be Implemented in Budget 2024
Ottawa, ON - In a move aimed at creating a more equitable tax system, the federal government has announced significant changes to the taxation of capital gains in Budget 2024.
Currently, only 50% of capital gains are subject to taxation in Canada. This means that taxpayers can significantly reduce their tax burden when selling assets such as cottages or investments.
To address this disparity, the government has proposed increasing the inclusion rate on capital gains for individuals. The new rate would see 66.67% of capital gains over $250,000 included in taxable income.
Additionally, the government has proposed a substantial increase in the lifetime capital gains exemption for business owners, raising it from $1 million to $125 million.
These proposed changes are intended to ensure that all taxpayers contribute their fair share to funding essential public services while supporting economic growth and job creation.
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