Tax & Spend
Capital Gains Tax Hike a Start But Canada Needs More Revenue, IMF Says
- IMF: measure to improve system’s neutrality, but more needed
- Canada should tighten fiscal policy to restore debt buffers
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The International Monetary Fund says Prime Minister Justin Trudeau’s capital gains tax hike will improve the system’s neutrality and won’t significantly harm investment or productivity growth, but his government must do more to boost revenue and tighten fiscal policy.
The increase to the capital gains tax inclusion rate — to two-thirds from one-half — has drawn the ire of businesses that say it will worsen an already dismal investment landscape. In its concluding statement of a staff mission to Canada, the IMF found that outcome is unlikely.