Chrystia Freeland would drop the Canadian government’s policy of raising the capital gains inclusion rate if she wins the race to replace Justin Trudeau as prime minister, according to a person with knowledge of her plan.
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.
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$! So even if you’re making the same revenue from your salary than from your investments, you have more money left in your pocket from the money made from an investment than from your salary.
That’s why it’s considered a measure for the rich, you need to be able to have a significant investment to be able to be taxed at a lower rate than you should.
The capital hains tax is a double tax, not a seperate tax.
A person gets paid, government taxes the person for making money. With the money the person has left, they invest that money, they withdraw or sell their investment, they get taxed on that money again, the capital gains tax.
Capital gains tax serves as a punishment for being smart in business and financial management, typically from people who are envious and jealous that other people are successful and they are not, so take it away through taxes to oppress all people equally. For that reason, some people turn a blind eye to anyone who commits tax evasion.
They only get taxed on the gain you made on that money. It’s a tax on the additional revenue an investment provides.
Capital gain tax is already a measure for the rich, since it is only taxes on 50% of the gain. People that can have significant revenues from investments (eg people with money), will be taxed at much lower rate than if they would make that same money through a job.
Let’s give you an example:
You have a salary of 100 000$ 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.
Well done keeping your composure while explaining!