While only preliminary details about the FHSA have been released at this stage, some important policy issues arise from what we know so far. Read this articleAn early look at the new federal Tax-Free First Home Savings Account
A vaccine tax is less coercive and more socially efficient than a vaccine mandate. We estimate that a tax of $1,500 per vaccination or booster per year is needed to effectively encourage opponents to get their shots. This amount is large enough to be salient to vaccine-hesitant, yet small compared to penalties imposed on daily smokers and heavy drinkers – where the economic case for penalties is far weaker than it is for COVID-19. Read this articleThe case for a vaccine tax
The current tax preference for capital gains costs $35 billion annually – with high-income families accruing most of the benefit. The recent passage of Bill C-208 exacerbates these issues. To fix these problems, the inclusion rate for capital gains should rise to 80 per cent from the current 50 per cent. Read this articleWhy won’t Canada increase taxes on capital gains of the wealthiest families?
Part II: The underlying problem is the differential that exists today between personal tax rates on taxable dividends as opposed to capital gains. Read this articleSurplus stripping: We need to fix Canada’s tax rules
Part I: A recently approved private member’s bill is deeply flawed and opens the floodgates to aggressive surplus stripping schemes. It should be fixed. Read this articleUPDATE: Surplus stripping and the new, costly tax loophole for intergenerational transfers
The rise of small-business incorporation is suppressing taxable incomes of rich Canadians. The growing gulf between top personal tax rates and the low rates paid by small CCPCs is driving the rise of incorporation. Read this articleAre the rich really getting poorer in Canada?
The debate over whether to increase the tax rate hinges in part on the extent to which a higher tax rate would distort investment decisions and reduce incentives for Canadians to invest. This commentary sheds light on this debate by analyzing the effects of a tax policy change in the mid-1990s that increased the effective capital gains tax rate. They find that the new higher rate on capital gains tax had no adverse effect on cumulative adverse effects on capital gains realizations. Read this articleEvidence on Behavioural Effects of Higher Capital Gains Taxes in Canada
This is the second commentary in a three-part series examining ideas for reforming Canada’s Employment Insurance (EI) program. This commentary discusses the need for the EI program to provide comprehensive insurance against various forms of income loss. The First commentary, on the need for EI to be better designed to insure against big shocks, can be found here. Read this articleAn Employment Insurance system for the 21st century: Lesson 2, The future of work calls for better income insurance
The first part of this 2021 edition of the Bilan de la fiscalité au Québec presents the tax announcements made by the Québec and federal governments, and by those of the other provinces, since the previous edition of the report. The next two sections compare Québec against the other Canadian provinces in terms of taxation. The fourth section presents an overview of tax expenditures in Québec and evidences the choices made regarding the different sources of tax revenues. Then, two sections examine taxation from different angles, namely, households (net tax burden) and individuals (profile of Québec taxpayers). Finally, the last section looks at various indicators of income inequality and how governments reduce inequality through taxation. Read this articleHighlights of interprovincial tax comparisons: Bilan de la fiscalité au Québec 2021 Edition
To address wealth inequality, and to improve functioning of our tax system, tax rates on capital gains income should be increased. The current tax preference for capital gains costs upwards of $15 billion annually. To equalize the tax treatment of gains and other income, the inclusion rate for capital gains on shares of small businesses should rise to 90% from the current 50%, and the inclusion rate for gains on shares of large corporations should rise to 70%. This would constitute a simpler, more efficient way of taxing high-wealth individuals compared to other recent proposals for a novel tax on wealth, and would likely raise more revenue as well. Read this articleIt’s time to increase taxes on capital gains