A chorus of doom claims that applying income tax to somewhat more capital gains will chase away investment and doctors. A closer look suggests the modest tax reform in the April 16 federal budget will increase productive investment, while continuing to favour doctors over wage earners. Capital gains come from reselling an asset for more than its purchase price. Budget 2024 expands the portion included in taxable income from one-half to two-thirds.
By exempting at least one-third of capital gains, the new policy more than allows for the one-quarter of real estate appreciation that covered inflation. The three-quarters that were a boon to property owners remain completely exempt for primary residences, and not fully taxable for investment properties. Buying and selling company shares also provides speculative gains and losses.