Firms Say Canada Tax Move Risks Deeper Productivity Slump
- Investor and business groups panned rise in capital gains tax
- Venture capital and private equity group ‘baffled’ by move
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Canada’s decision to increase capital gains taxes was criticized by businesses who warned the move would only exacerbate the country’s investment and productivity woes.
In a bid to raise billions of dollars to help pay for policies to correct a housing crisis which has turned off younger voters, Finance Minister Chrystia Freeland announced the government will tax Canadian companies on two-thirds of capital gains, up from half currently. The change will also apply to individual taxpayers with annual gains over C$250,000 ($181,000). The rules included some exemptions for entrepreneurs and the sale of a primary residence.