A Netflix tax, higher cigarette taxes, and face masks are taxable again

You can save this article by registering for free here. Or sign-in if you have an account.

First Reading is a daily newsletter keeping you posted on the travails of Canadian politicos, all curated by the National Post’s own Tristin Hopper. To get an early version sent directly to your inbox, sign up here.

Budget 2024 is indeed a tax-and-spend budget, in that it raises Canada’s already-high spending, and brings in a slew of new taxes to help pay for it. But all of its main tweaks on the tax system are occurring in areas where the average Canadian won’t see them (at least directly). Below, a quick guide to where the federal budget is squeezing its new revenue.

Enjoy the latest local, national and international news.

Enjoy the latest local, national and international news.

Create an account or sign in to continue with your reading experience.

Don't have an account? Create Account

An increase to the capital gains tax inclusion rate

This is the big one; the one measure for which Budget 2024 may ultimately be remembered. While 50 per cent of capital gains are currently taxable, Budget 2024 would raise that to 67 per cent.

To be sure, it’s not a tax rate of 67 per cent. According to calculations in an X post made by University of Calgary economist Trevor Tombe, it will work out to “roughly 52 per cent tax overall” — which is almost exactly in line with the top tax rate on income. Wrote Tombe, “inclusion rates can be used to better equalize treatment of capital gains vs other income sources, as the budget does.”

But businesses — tech startups in particular — are complaining that the capital gains hike is yet another factor hurting Canadian competitiveness as compared to lower-tax jurisdictions such as Ireland or the United States. The Canadian Venture Capital and Private Equity Association, for one, said it “taxes innovation and risk-taking,” and “will significantly dampen Canada’s........

© National Post