CTF taking government to court over capital gains tax hike
Despite no legislation ever being introduced, the Canada Revenue Agency is pushing ahead with increasing capital gains inclusion rates
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OTTAWA — Despite no legislation ever being passed, Canada’s tax collector remains intent on enforcing an increase to the capital gains tax — and Canada’s taxpayer watchdog is taking the government to court.
On Friday, the Canadian Taxpayers Federation announced they’re filing a legal challenge against the move.
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“The government has no legal right to enforce this tax hike because it has not received legislative approval by Parliament,” said CTF General Counsel Devin Drover.
“This tax grab violates the fundamental principle of no taxation without representation. That’s why we are asking the courts to put an immediate stop to this bureaucratic overreach.”
While numerous important bills died on the order paper when Prime Minister Justin Trudeau prorogued Parliament earlier this month, legislation to increase the capital gains tax — a key promise in the government’s most recent budget — was never tabled in the House of Commons.
Despite this, the CRA is pressing ahead with the increases — which would have increased the inclusion rate from 50 to 67% for those who earn $250,000 or more in capital gains.
A study released last week by the Fraser Institute suggests enacting the hike would rank Canada among the highest capital gains taxes in the world.
Earlier this week, former Finance Minister Chrystia Freeland — who defended the tax hike before publicly resigning from her role in December — pledged to do away with the tax hike if chosen as Liberal party leader.
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“The undemocratic capital gains tax hike will blow a huge hole in Canada’s economy and punishes people saving for their retirement, entrepreneurs, doctors and Canadian workers,” said CTF Federal Director Franco Terrazzano.
“The CRA must immediately halt its plans to enforce this unapproved tax hike, which threatens to undemocratically take billions from Canadians and cripple our economy.”
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