Overview

• The proposed capital gains tax hike, originally set for June 2024, has been deferred to January 1, 2026, according to Finance Minister Dominic LeBlanc.
• The tax change would increase the taxable portion of capital gains from 50% to 66.67%, with exemptions for primary residences and thresholds for individuals exceeding $250,000 in annual gains.
• The delay follows legislative gridlock after Prime Minister Justin Trudeau prorogued Parliament, leaving the proposal in limbo without formal enactment.
• Taxpayers faced confusion over whether to file under the proposed or existing rules, as the Canada Revenue Agency initially planned to administer the hike despite its lack of legislative approval.
• The decision to postpone comes ahead of a widely expected federal election, with opposition parties and some Liberal leadership candidates pledging to scrap the tax hike altogether.