Canada’s government plans to reverse course on the capital gains tax increases announced in its last budget, a senior government source told CBC News on Thursday.
Ottawa is weighing ordering tax authorities to stop collecting the higher rates, which raised inclusion rates to 66.7% from 50% on gains above C$250,000 ($185,000) for individuals and all corporate gains.
The Canada Revenue Agency has collected the increased rates despite Parliament not passing the legislation after Prime Minister Justin Trudeau prorogued the session.
Also read: Taxpayer Group Takes CRA to Court Over Capital Gains Tax
Former Finance Minister Chrystia Freeland championed the tax hikes to fund healthcare and childcare programs but has backed away from the policy while seeking Liberal leadership.
Also read: Freeland Makes a U-Turn on Capital Gains Tax
“I’m not going to breathe a full sigh of relief just yet — until we know that this proposal has effectively been killed,” Dan Kelly, Canadian Federation of Independent Business president, told CBC News. “Right now, I would describe it as being on life support.”
The government has not finalized its plans. A delay past the next election could “effectively kill” the measure.
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