Amidst the current housing dilemma in Canada that imposes significant challenges on young potential homeowners, Prime Minister Justin Trudeau has put forward a fresh proposal concerning Capital Gains Tax. This tax proposition seeks to impose a rate ranging from 50% to 67%, varying based on the taxpayer's income level.

Capital Gains Tax is a fee imposed upon individuals when they vend assets or capital properties, with capital gains signifying the profits arising from such transactions. The Canada Revenue Agency's webpage delineates these capital properties to include retreats, securities (like stocks, bonds, cryptocurrencies, and units in a mutual fund trust), real estate, and constructions.

Commencing June 25th, the envisioned amendment would affect those individuals garnering more than $250,000 CAD annually from capital gains. Corporations and trusts will also confront heftier tax obligations on a greater portion of their profits. It's asserted by the government that this alteration particularly targets the wealthiest 0.13% of individuals, encompassing roughly 12% of Canada's companies and citizens claiming an average income of $1.42 million CAD. The Liberals stressed that 99.87% of Canadians will not be touched by this change, specifically exempting sales of primary residences. Forecasts suggest that this policy adjustment may yield $19.3 billion in revenue over the coming five years.

In Canada, cryptocurrency is categorized as business income or capital gain and designated as a commodity in terms of tax regulation. Canadian taxpayers aren't mandated to pay taxes when they purchase or retain cryptocurrencies. Nonetheless, taxes become applicable on capital gains or business income derived from cryptocurrency transactions, mining endeavors, or other related activities. Individual crypto holders are taxed for 50% of their total capital gains, while professional traders, often engaged in daily trading activities, are taxed for the entirety of their profits.

In Canada, any taxable capital gains must be reported as income in the tax declaration for the year in which the stocks were sold. Typically, the income from such transactions is presumed to be 50% of the capital gain. For example, if an asset is sold for $2,000 CAD with an adjusted cost base of $1,000 CAD, the taxable income would amount to $500 CAD ($1,000 gain multiplied by 50%). This $500 CAD needs to be included in the taxable income and will be subject to taxation at a marginal tax rate aligned with the tax bracket. Under the proposed Capital Gains Tax legislation, if the sum surmounts $250,000 CAD, the annual tax rate could vary from 50% to 67%.