The measure, which applies to the sale of certain real estate, has been shelved for now
The federal government is delaying plans to increase taxes on capital gains until the beginning of next year, with the hike – announced in last year’s federal budget – now scheduled to come into effect on January 1, 2026.
Finance minister Dominic LeBlanc said on Friday the government was pushing back the date of that change to give Canadians more certainty as tax season looms, although the delay will plunge the measure into further doubt with Opposition leader Pierre Poilievre – who currently leads opinion polls to form the next government – pledging to scrap the policy if elected prime minister.
The hike was originally scheduled to come into effect last June, but legislation implementing the change still hadn’t been approved before Prime Minister Justin Trudeau prorogued Parliament this month.
“Given the current context, our government felt that it was the responsible thing to do,” LeBlanc said in a press release. “I look forward to further conversations with Canadians on how we can ensure Canada’s fiscal policy encourages robust and sustained economic activity in every region of our country.”
Currently, 50% of profits realized on the sale of an asset such as a secondary property are included in income tax calculations, with the Liberals proposing to increase that to 66.67% under the new rule.
That higher inclusion rate would only apply to annual capital gains exceeding $250,000, with other exemptions pencilled in for businesses and the sale of primary residences not included under the new rule.
Liberal Party leadership candidate Chrystia Freeland, who introduced the policy as federal finance minister, recently said she would nix the capital gains tax hike if elected.
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