this post was submitted on 23 Jan 2025

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Freeland to Scrap Canada’s Capital Gains Hike If She’s Elected (www.bloomberg.com)

submitted 1 week ago* (last edited 1 week ago) by lightrush@lemmy.ca to c/canada@lemmy.ca

36 comments fedilink hide all child comments

Do I smell austerity for the working class?

top 36 comments

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[–] T00l_shed@lemmy.world 46 points 1 week ago (1 children)

It's always austerity for the working class.

[+] 9488fcea02a9@sh.itjust.works -9 points 1 week ago* (last edited 1 week ago) (2 children)

i agree that the rich need to be taxed, but i don't think taxing these rich people is what will solve most of our problems.... taxing a few thousand rich people who made $1M on stocks or whatever is a drop in the bucket compared to our real problems.

what are the real problems? billionaire oligarchs plundering our country. what are the exact steps to fix the problem? i'm not smart enough to figure it out. but we can start by ending corporate handouts, or things like oil companies sticking us with the cleanup bill when the leave town. fix price gouging on groceries and telecoms. i think actions like these are going to have a huge impact on the prosperity of working canadians versus an increase in a capital gains tax on the moderately rich.

[–] streetfestival@lemmy.ca 22 points 1 week ago (1 children)

First off, this move is antithetical to the idea of making the wealthy pay their fair share of taxes. Second, if you're making $1M on capital gains in a year, you're not upper middle class or lower upper class - or whatever 'they're not that rich' argument you intend. Third, and most importantly, the upper middle class/lower upper class (to use dated terminology) being taxed on their capital gains is a by-product. These taxes also catch, probably as they are intended to, people making 10 million or 100 million (I can't imagine lol). And let's not forget, they didn't work an hour to make that money.

How come only those of us with jobs should pay income taxes?

[–] T00l_shed@lemmy.world 13 points 1 week ago (1 children)

The working class ain't "rich" people though

[–] 9488fcea02a9@sh.itjust.works -5 points 1 week ago* (last edited 1 week ago) (1 children)

lots of working class people are going to be hit with these capital gains taxes...

i am probably going to get hit by this tax increase and i'm not particularly wealthy. but i don't care either way, if i'm taxed, then i'm taxed

my point is that there are bigger fish to fry, rather than going after dentists or whatever moderately wealthy people.

people online seem to think that anyone with a portfolio of investments is basically on the same level as galen weston....

[–] T00l_shed@lemmy.world 7 points 1 week ago

I think you missed something here. There was a mention of austerity for the working class. I said it's always austerity for the working class. Yes there are bigger fish to fry that had nothing to do with what was said.

[–] wise_pancake@lemmy.ca 32 points 1 week ago (3 children)

I'm fine with a lower inclusion rate if we cap it at a fixed dollar threshold.

If you make $1M in a year from capital gains, just tax it 100% as income.

The real problem with this is executives getting paid primarily in stocks and paying a lower average tax rate than the middle class because 50% (currently 33%) is excluded.

Also, Freeland being the #2 in Trudeau's government, and all her policies being to undo the things they did looks bad to me. I can't shake that either she was ineffective or they were just bad ideas.

[–] cyberpunk007@lemmy.ca 8 points 1 week ago (3 children)

There's nobody good to vote for.

[–] Mongostein@lemmy.ca 17 points 1 week ago (2 children)

Singh it is, then.

[–] Sturgist@lemmy.ca 10 points 1 week ago (1 children)

I'm voting NDP, but after that shameful instance of childish name calling on Singh's part. Idk. I don't really have anything against him, from what I've seen and read he's not doing too bad a job in the leadership role. Would have been better if he'd been a bit more mature, and not stooped to the same shenanigans as little PP. It's a bad look. He had the chance to be the adult in the room, but flubbed it.
If anyone has any reliable sourced reporting re: Singh doing well or poorly, I'd be interested in seeing it. I would prefer to be an informed voter.

[–] Mongostein@lemmy.ca 20 points 1 week ago* (last edited 1 week ago) (1 children)

Well, it’s like this:

We’ve been flip-flopping back and forth on Conservatives and Liberals since forever. No one’s happy.

If it weren’t for the NDP agreement with the Liberals we wouldn’t be getting dental care, which comes in to effect for the rest of Canadians this year, and pharmacare which is supposed to come later.

These are real tangible benefits that every Canadian will be able to see and feel and that means more to me than a carbon tax.

You’re worried about Singh name-calling? The dude is getting our teeth fixed and he’s not even PM. Focus on the real things.

[–] Sturgist@lemmy.ca 7 points 1 week ago

Totally fair. And this is exactly the type of thing I was asking for.
Hard to keep perspective sometimes.

[–] lightrush@lemmy.ca 4 points 1 week ago (1 children)

While I do not want to vote for Singh, the leader, I would vote for the NDP candidate in my riding if the polls don't show them far behind.

[–] Mongostein@lemmy.ca 7 points 1 week ago (1 children)

For better or worse, in Canada we don’t vote for PM, it goes to the leader of the party.

Both the other parties are clearly in the pocket of corporations. The NDP held the Liberal’s feet to the fire and got us dental care.

That alone is reason enough to vote for them in my opinion.

[–] lightrush@lemmy.ca 4 points 1 week ago

No disagreement.

[–] wise_pancake@lemmy.ca 9 points 1 week ago

We’ll see. I’m interested in Carney, he’s saying the things I wanted to hear from the liberals for years.

[–] lightrush@lemmy.ca 1 points 1 week ago

Perhaps not good but less bad is what we look for.

[–] stealth_cookies@lemmy.ca 7 points 1 week ago

Getting paid in stocks doesn't affect how much income you report though. Shares are taxed as income as soon as they vest, and options are considered income when you exercise them at the difference between fair market value and the strike price.

It is only additional capital gains after that point that are taxed at the reduced rate because it is the same starting point as if you bought the shares on the open market.

[+] chonglibloodsport@lemmy.world -6 points 1 week ago* (last edited 1 week ago) (1 children)

If you make $1M in a year from capital gains, just tax it 100% as income.

Capital gains don’t accrue until you actually sell your shares. If you try to tax people like this then they’ll just never sell the shares. Instead, they’ll use their shares as collateral for loans and lines of credit if they need cash.

Extremely high taxes lead to very low tax revenues since people do everything possible to avoid paying them. Conversely, lowering a tax rate can and does increase tax revenue as people start paying the tax instead of trying to get around it (often because the cost of getting around the tax makes it no longer worth it).

[–] rbos@lemmy.ca 4 points 1 week ago (1 children)

We tax the theoretical assessed value of houses, why not stocks?

[–] chonglibloodsport@lemmy.world 1 points 1 week ago* (last edited 1 week ago) (1 children)

How would that work? Stocks go up and down all the time. Sometimes people hold them for years, sometimes they trade them rapidly throughout the day.

Suppose we tax people on a percentage of the increases in their stocks when they go up. Are we going to give them a tax refund when the stocks go down? Or is it just going to be a ratchet that drains away all their money as the stock rapidly goes up and down throughout the day?

There’s a lot of different things you can do but at the end of the day the question is: will people still want to keep investing after you make the change? If the answer is no, then why not simply shut down the stock market altogether? Of course the answer to that is that everyone will start investing through a black market.

The really hard part about tax policy is that you can’t just look at the way things are now and then assume they’ll stay the same while you collect a tax off the top. In reality, people change their behaviour to avoid taxes as much as possible so taxes on specific things tend to have distortionary effects on the market.

If you want a very good example of a non-distortionary tax, look at land value taxes. The beautiful thing about them is that you can’t take your ball and go home. You can’t move the land with you to another country (not without an army anyway). You can’t even destroy the value of the land (for LVT purposes) by say, burning down the buildings, because LVT is based on the value of the land without any buildings or other improvements. All you can do is pay the tax or sell.

[–] NotMyOldRedditName@lemmy.world 1 points 1 week ago* (last edited 1 week ago) (1 children)

I've always thought a tax on taking a loan out using your stock as collateral is a good idea.

Borrow 1mil, tax it like half of capital gains. Repay the loan, get it back. Sell the assets to pay the loan off, pay the other half of the capital gains.

Or something like that.

Only do it for the wealthy on these bigger transactions. Maybe even starting at 10m, I dunno. They can afford the accountants to do it right at that point.

Edit: and only if the money is taken out of the investment account or used outside an investment account. So you can trade on margin, but not withdraw the loan to buy a house.

[–] chonglibloodsport@lemmy.world 1 points 1 week ago (1 children)

Start it at 10m? So if you only borrow 9m you pay no tax?

[–] NotMyOldRedditName@lemmy.world 1 points 1 week ago* (last edited 1 week ago)

It'd probably has to be aggregate, so you don't just do 10 $1 million loans as well. A million seemed too low as that'd hit a lot of people and small businesses. Somewhere between 1 and 10.

Keep in mind there is interest on these loans that has to be paid eventually, which probably involves taxes, unless they're so wealthy they can just keep chaining it forever until they die which is what the billionaires do.

Edit: at least with something like this, we aren't taxing unrealized gains without them trying to access the gains.

[–] droopy4096@lemmy.ca 29 points 1 week ago (1 children)

she's following into Harris' footsteps. Courting conservative voters... bad move

[–] streetfestival@lemmy.ca 15 points 1 week ago

The parallels between the republican/democrat and conservative/liberal parties in that dems/libs are to some degree better than the more right-wing parties but still bent of @#$%ing the working class is tough to stomach

[–] TOModera@lemmy.world 20 points 1 week ago

Oh, so she doesn't want to win, got it.

[–] Sunshine@lemmy.ca 15 points 1 week ago (1 children)

Of course Bloomberg posts this jumping up and down.

[–] streetfestival@lemmy.ca 11 points 1 week ago (1 children)

globe and mail editorial endorsement of Freeland to follow 🤦‍ (facepalm)

[–] wise_pancake@lemmy.ca 6 points 1 week ago

That paper has gone down hill.

My dad loves the new direction, I find it's an editorialized mess, so we don't talk about the globe and mail anymore.

[–] surph_ninja@lemmy.world -3 points 1 week ago

Of course she will. She’s a Nazi. That’s not a wild accusation because I don’t like her- she has been linked to and openly defended Nazis in multiple scandals.

And fascists defend capital. They are one and the same.

https://globalnews.ca/video/9987040/freeland-asked-about-reopening-investigation-into-nazi-war-criminals-living-in-canada/amp/

[+] Mettled@reddthat.com -18 points 1 week ago (1 children)

The capital hains tax is a double tax, not a seperate tax.

A person gets paid, government taxes the person for making money. With the money the person has left, they invest that money, they withdraw or sell their investment, they get taxed on that money again, the capital gains tax.

Capital gains tax serves as a punishment for being smart in business and financial management, typically from people who are envious and jealous that other people are successful and they are not, so take it away through taxes to oppress all people equally. For that reason, some people turn a blind eye to anyone who commits tax evasion.

[–] CodeGameEat@lemmy.world 18 points 1 week ago (1 children)

They only get taxed on the gain you made on that money. It's a tax on the additional revenue an investment provides.

Capital gain tax is already a measure for the rich, since it is only taxes on 50% of the gain. People that can have significant revenues from investments (eg people with money), will be taxed at much lower rate than if they would make that same money through a job.

Let's give you an example:

You have a salary of 100 000$ and have 1 000 000$ in investments. Your marginal tax bracket is 40% (for this exercise let's also consider there is no additional tax bracket). After tax, your salary is 60 000$. With your investment, you make 10% annually, so that is an additional 100 000$! If it were taxed as revenue it would cost you 40 000$ in taxes, but since capital gain is only taxed at 50%, you only pay 20 000$ in taxes. That leaves you with an additional 80 000$! So even if you're making the same revenue from your salary than from your investments, you have more money left in your pocket from the money made from an investment than from your salary.

That's why it's considered a measure for the rich, you need to be able to have a significant investment to be able to be taxed at a lower rate than you should.

[–] lightrush@lemmy.ca 8 points 1 week ago

Well done keeping your composure while explaining!