Could the capital gains tax in Canada increase?

Could the capital gains tax in Canada increase? Could the capital gains tax in Canada increase?

1 Expert Answer

Don Scott

FCPA, FCA, Partner/Director of Tax Services,  Welch LLP

I believe this will happen eventually, but probably not in 2021. There would be an impact on capital markets – something that is not good during an economic recovery. The current capital gain tax rate is considerably lower than the tax rate on a dividend, people spend a lot of time planning so that they can realize a capital gain instead of a dividend with respect to remuneration from their business. The simple fix to deter this is to raise the capital gain tax rate to be closer to the dividend tax rate.

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