The capital gains tax, explained
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- Опубликовано: 21 апр 2024
- When the federal government released their 2024 budget last week, they changed the capital gains tax for the first time in a quarter-century. The tax is set to bring in $19.3-billion dollars, and the government says it’ll only impact the wealthiest of Canadians. But many are disputing that.
Salmaan Farooqui, a personal finance reporter with the Globe’s Report on Business, is on the show to tell us about the basics of capital gains and how this tax might affect Canadians.
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Capital gains is not real value/income. A large part of capital gains is inflation and Inflation is not real value.
It is a crime to be successful in Canada and taxes is the penalty
Nope!
@@Iban-UndergroundThen why is it a measly 150,000 and up in income is taxed at almost 50% between both federal and provincial taxes, forgetting all the slew of other taxes.
@@theangrycanuck8331 Are you trying to refer to the costal gains tax here? Also, was it a crime to be successful during the 60s?
@@Iban-Underground I'm refering to income tax, where you are taxed per bracket on a different rate, and when you hit 150,000 you are essentially taxed half of your income.
You don't know anything regarding taxes do you? You think its like a game. "Oh set to 10% so it's 10%"
Forgets tax brackets, federal and provincial taxes, cpp, mandatory EI if employed by an employer, also forgets there's sales tax, property tax, fuel tax, duty tax, corporate tax, so on and so forth.
@@theangrycanuck8331 No I was just trying to figure out what you were trying to refer to since you are very poor at explaining your points.
Anyways, answer the question. Was it a crime to be successful during the 50s and 60s?
Taxation is the penalty for being a productive member of society.
Totally agree matthew
Nope! Society is a collective effort that requires all of us to pitch in and work together in order to make it function.
And wouldn't you know it, people who become increasingly wealthy tend to try and hide from that fact. The Panama papers were a great example of that.
Taxation is what you pay for using collective social effort.
@@Monzeobe no its what's paid to excuse greed and by way corruption. Look at the food sold in stores, super low quality with a list of industrial chemicals for ingredients. Many who champion taxes are those who wish to worship bureaucracy as their stand in god. How long people? How long will you suffer such evil? How long will you reject the Truth who is manifest in King Jesus?
Yep, all of these people forget that societies existed long before taxes, and many societies have much less taxes today and function just as well.
Being taxed on making money is absurd in the first place.
How can your guest suggest that RRSPs are exempted from Capital gains tax? All of the capital growth of your RRPS investments are taxed upon withdrawal at an inclusion rate of 100%. All of it. Deferral is not the same as exemption.
What about conversion to RIF account? It's not all but you can hedge a good withdrawal tax free no?
Canada struggles to gain investments already.
Unfortunately this is the type of tax thats generally supported by the envious. So this point will be ignored. The fact that this actually hurts the country will be ignored.
@@robertb8629No one supports having 50% of your heard earned profits, put into taxable income and then taxed at 50% if you're over 150,000 annual income. That's an absurd and buffoonish premise that no one who actually has the drive to be successful, will support.
Capital gains explained, you make money, the government takes it,so simple.
Naw not really.
So why would anyone want to invest in Canada?
Not me. Furthermore, the CAD$ is losing so much value that it could go down to 50 cents to the US$.
Because there is money to be made. No business would drop an entire market because of a bit of tax.
Most companies didn't even pull out of Russia who invaded another country lmao. Why would they pull out here?
@Iban-Underground: maybe mention that to the doctors refusing to come here because of the taxes.
@@BudzzableRides That most certainly is not the reason they won't come here lmao. It has more to do with the fact that they can make a killing off the private system in other countries over a public one in Canada. (See, the USA)
But good news! A better funded public system means more money for doctors in said system, encouraging them stay. More good news, we can also leverage a tax exemption for doctors and nurses to help encourage them to stay as well!
Oh, and doctors and corporations are two seperate things. My original point still stands.
@Iban-Underground naive to think that. Besides using 'tax exemption' as an incentive implies that you have surrendered your will to bureaucracy, and now they are renting it back to you under certain conditions. The madness is too apparent to ignore.
They have already floated the idea of Capital Gains Tax on Primary Residences - Unbelievable.
It's time to downsize the canadian government
Eat the rich
@TokerSurvivalHandbook if you have more than one pair of closed toe shoes you are in the top 90%. Throw yourself on the grill first.
@@TokerSurvivalHandbook why are they getting bonuses passing laws taxing the middle class
@@theangrycanuck8331 why do you work for Russia 😂
@@TokerSurvivalHandbook They're more competent than us
All these extra costs for corporations are going to be passed down to employees. Companies are already struggling to pay employees, now with this, everyone is on the edge of their seats hoping they wont be let go ☹ let alone any raises 😭
Maybe in a booming economy, this move is ok, in an economy with steady GDP decline, this will only hurt Canadians even more…
Boo Hoo
This is quite informative. Thank you for putting this together.
Bots r sad
I can explain it. The government borrows enormous amounts of money. This is not preexisting money but new money created for that purpose. This of course increases the money supply thus decreasing the value of the money. This causes the price of everything to rise relative to the falling value of money. Of course the price of houses will also rise. As this trend continues most or all houses will pass the magic minimum threshold they set for capital gains tax. So in addition to all the other taxes, almost every house will be taxed evey time it's sold. But wait what they really want is a yearly federal tax on all real estate. They will eventually be taxing on not only fake inflation gains, but also on potential gains.
Only comment with likes lol 😅
Taxation helps fight inflation by returning money back to the pool it came from, so your argument doesn't hold up. As well the money it is taking back currently, is for people who are making over 250K in gains in a year, even with current inflation rates it'll be a long way off before that affects the regular Canadian, majority of whom can't currently even afford a house or property to ever even reach this kind of taxation. Also, inheritance taxes and high capital gains taxes can influence housing prices and drop them, by less incentivizing the using of a real estate as a form of investment. Seeing housing as a human right and not an investment is something we need right now in order to deal with the countless encampments in cities across the countries, reducing the high rents, and actually enabling our people to live in homes.
Wtf
@@nickbarss1693Help return money? Inflation is literally caused by creating money INTO THE SUPPLY without any PRODUCTION TO BACK IT.
Taxation only removes any money with value from the hands of everyday people, to cover the cost of rising prices due to the inflation of the money supply.
Who is John Galt?
Idk who is he. Please explain who is he, otherwise I, a Canadian, will not know. Go on, be open.
@@Iban-Underground it is a quote from a book called “Atlas Shrugged” by Ayn Rand. Good read. It explains what is happening to our country right now.
@@queenbigb personally I'm a big fan of 1984. By everyone's favourite socialist, George Orwell.
So what happens if you sign as a mortgage guarantor for your child who otherwise could not get a mortgage during the crippling interest rates, but do not wish to benefit from it as an investment. I.E. your child sells the house to move but you do not get the benefit from any increased value of the house?
Good question - perhaps as it was your child's primary residence it would be exempt?
My guess nothing, a co signer is signed to the house and mortgage so maybe then you would but I highly doubt it, a guarantor is only signed on the mortgage so I would expect even less of a chance.
Very good question. Seem like replies are "perhaps" or "may be". I think, we should ask this question from our bank or the CRA. I feel like the govt will try finding all possible avenues to leech off money from hardworking taxpayers for their bribe spending for votes.
As long as you’re not on title as one of the owners. Owners of the property would be subject to gains tax if not primary residence of the owner(s)
You pay per what you own as an intreast in a property jf you own 1 percent you pay the tax on 1 percent
I’m willing to bet that the tax free savings account is not completely tax free. There’s a catch.
half of it will go to ukraine !
If only.
So , 20 years ago the capital gain tax was reduced to attract capital, now in twenty years those who we’re attracted and invested into real estate to obtain something to support pension are punished by the same Party?
You're right, it never should have been reduced in the first place.
@@Iban-Underground After all, fuck having anyone invest in our country, clearly revenue is doing so well the federal government isn't hiking taxes across the board cause it's broke as f
Oh wait it is.
@@theangrycanuck8331They can and will invest in our country regardless of taxes. Corporations will not miss out on a market just because something minor is in the way. Look at the companies that "sanctioned" Russia as an example.
And again, people operate and invest in Nordic countries, that have higher taxes rates than we do.
@@Iban-Underground You know the Canadian Government also purchases and deals with Russia despite putting sanctions.
Corporations pay more tax than you, and so do people that make more money than you. Eventually you'll make them all look elsewhere and you'll have to cover their share or live without what they paid for.
@@theangrycanuck8331 There is a difference between a state's sanctions and corporation's sanctions. But beyond that, what I am referencing is how corporations "sanctioned" Russia, pulling out of its markets. Only to sell it under a subsidiary in Russia, changing only the logo. The point is, companies will never pull out of a market.
And how about addressing the Nordic countries? Don't ignore it because it disproves you.
So if you invested in real estate you’re screwed, so if you own a cottage you’re wealthy now , and the amount of Canadians who own cottages is not insignificant
Housing shouldn't be an investment
gotta laugh at all the pearl clutchers cryin' about paying marginally more cap gains after the first $250 profit.
Easy. We're all screwed
This is confusing. Your telling the viewers that the whole amount is taxed??? 50%up to 250,000 and 2 third when its $1m This is my understanding of the new CGT and correct me if I'm wrong. The first $250,000 in capital gains, an individual taxpayer would continue to pay tax on 50 per cent of that gain. For every dollar beyond $250,000, two-thirds would be taxable. For example half of the 250,000 is taxed at marginal rate you keep 125000 plus what left after the other 125,000 being taxed. When your CG is more than 250,000 let's say by another 100,000. The 2 third of the 100,000 which is 66,666 will be taxed at the margin rate. This country have natural resources and the best one the government always choose are the people pockets. Good luck everyone
They set the target too broadly. Among them are NOT-0.1%-wealthiest people and to-be-retirees. Basically their propaganda of tax on 0.1% is a lie because everyone retires in some way or another.
Those are the loopholes that people like O'Leary will continue utilize with money
So what's your solution then? No seriously, if the wealthy won't pay their taxes, or try to get out of them all the time, then what should we do to ensure they are taxed.
Think hard, I'd love an answer.
The new capital gains tax hike won’t work as claimed, but will harm the economy as the economic costs exceed the amount of tax collected! Capital gains taxes are not paid exclusively, or even largely by ultra-high-income earners. Rather, Canadians with much lower levels of income, including many entrepreneurs and small business owners cashing out after a lifetime of work pay the majority of capital gains taxes in Canada. Therefore, any increase to the capital gains tax will affect Canadians across a variety of income levels, not simply the rich, as is claimed by Trudeau/Freeland.
No it won't. Every Nordic country with higher taxes is fine. The states also announced an increase in clerical gains tax. Calm down
@@Iban-Underground Are we now taxing Canadians in to poverty to change the world's weather?
How much carbon tax have you collected ? Freakland : this is a great opportunity to bring up a family in Saskatchewan will get a rebate of 1200 dollars..
Yeah it’s the the families who aren’t wealthy who bought cabins years ago to use as recreation and pass on to their kids and now cannot because their kids cannot afford the capital gains… it’s ripping families apart….
Oh the drama. "Ripping families apart"? Give us a break. God forbid people who don't have to work for something that is grossly overvalued inherit it with some strings attached. Seems greed is always fine until it runs full circle and negatively affects the people who benefited from it. Maybe astronomical property inflation that shuts out a large % of the population from "the market" isn't so great after all, eh?
Capital gains tax explained
- You are going to be a renter for the rest of your life until the day you die…
- You don’t have to be concerned at all with capital gains…
Shows your ignorance
@@gujaraticanadianthe ignorance is the stupid government who can’t handle their own finances so they have to rob everyone to compensate for their terrible job
Principal residences have been exempted from capital gains for MANY years
Own nothing be happy says Klaus swabs
" you will own nothing and be happy " wef
No I just work hard. I will average 80 hours a week anyone can do what I do and I don’t waist my money like the government.
80 hours a week is literally illegal. Either this poster is lying, or they are a criminal.
Taking bets now folks.
Can't attract doctors or others that operate thier oun office..to America were tax is half of here ..
Crooks
Tax them and they leave. The top will always do that.
Literally no lmao. Corporations *never* leave a market
Its what i call, THE SECOND STEP, MAKING RULES FOR THE THIRD
cant you just get a collateral loan on your assets instead?
It’s not like anyone has to hoard
Government mouth piece
Its theft, there, saved you 20 mins of propaganda. Go enjoy your family.
100 percent all paid media here
Taxation isn't theft.
he taxes 1 dollar in tax we get 10 cents in benefits
Morally bankrupt, that’s Trudeau
Small government
Love all the bros who think money grows on trees. Stuff has to be paid for, grow up.
an "average" canadian will totally be affected as most of us are employed by those who will now be taxed more. Higher taxes do not promote employment and job growth for obvious reasons. this is to say nothing about some of an additional tax burden being pushed down to consumers. all in all, hold on to your seats.
this is Trickle-down economics nonsense and the theory of the simple sucker.
corporations ain't raising salaries or jobs just because they can.
they reinvest in their businesses when their profits are taxed at high levels when it reaches astronomical levels ...to coin a term 'for obvious reasons'.
Naw
Average canadians that do anything to earn extra income will be affected, dude people buy stocks at home, that's capital gains. It's not just rich people.
@@theangrycanuck8331 Which is it mate? Can Canadians "not afford homes" like the cons are saying, or are they all buying second homes to sell as a stock?
Which, mind you, is disgusting. Decommodify homes.
@@Iban-Underground First of all, no people can't afford to buy homes because there is far too low supply and far too high demand, making it very difficult for anyone without liquidity capable of putting down a big down payment, to get a mortgage on a fixed rate that isn't going to essentially kill their entire income. It's cheaper now to rent, than to own a home. Secondly, you can't decomodify a home, a home is a literal product that must be manufactured with goods and labour, thus has a value that must be met or guess what? No ones building that home and you're not getting materials to build it. And since developers invested into materials and labour to build that home, of course they want to profit from its sale, and after the first home owner has owned that property and taken care of and maintained it, thus raising its value, they want to sell it off or pass it down to either profit off their investment, or keep growing their investment.
You don't deserve free things just cause you want them. Get a job and provide value to society.
"Investors / realtors" next is jail time. Too long damaging the values
Well it was at 75 % when money was really less. Duh….
What they should do, is stop overspending so we do not have these ballooning interest payments that we can’t keep up with. But no, let’s give away our money to foreign counties for war games and tax the crap out of its citizens. If you vote liberal this election-then you love poverty and deserve poverty.
Ahh yes letting *checks notes* Russia invade other countries is the policy of the *squints eyes* "good guys".
"Investors" they only can charge 30% of their mortgage to a tenant, the other 70% is on you to pay your mortgage. It's not 120% to tenants
Are you serious?
@@cpogan157Did you think Tenants cover all of the cost?
My rent is 1650, the mortgage on my unit before property taxes is around 3400 a month lol
i am not part of the wealthiest and will be affected.
Naw you won't be.
I just did a calculation and yes I am.
@@MPOEducationalEnterprises what do you do?
@@Iban-Underground@Iban-Underground I am the owner of two companies; one of them was destroyed by the government's pandemic policy and is slowly coming back and the other one is an LMS.
@@MPOEducationalEnterprises Whomp Whomp, you're one of the wealthy.
Pro liberal party bs
progressive tax isn't enough
It's a start at least.
Asking for slavery wow. Look to Yeshua and repent
@@Rflows100 how so? Were the boomers endlaved when they had high capital gains tax?
@@Rflows100
if only you understood politics and economics
@@thetruedemocraticnorth Do you know what the tax burden is already for people that make over 55,000 a year?
I'm here to laugh at the comments of would-be intellectuals and experts.
Don't mind me.
You're an odd bird.
Same lmao.
Canada is a semi capitalist but mostly socialist country. Kind of like modern day robin-hood. You need measures to keep people in Canada 🇨🇦.
semi capitalist lol??? We're a social democracy.
You are funny. You obviously never work as an entrepreneur. Well I guest every single successful business man is working illegally. This is why we make more money than you and deserve to keep it.
Naw, pay taxes brokie.
Rich people crying they don't want to pay their fair share, eat the rich