2024 Budget proposes to increase Capital Gains Inclusion Rate

New Inclusion Rate Effective June 10, 2024

For Capital Gains Realized on or After Budget Day

The 2024 budget proposes to increase the capital gains inclusion rate for capital gains realized on or after budget day, June 10, 2024. The inclusion rate for capital gains is the percentage of a capital gain that is subject to tax. The current inclusion rate is 50%, meaning that only half of a capital gain is taxable.

The proposed increase in the inclusion rate would mean that two-thirds of a capital gain would be taxable. This would effectively increase the capital gains tax rate for individuals from 25% to 33.33%. This change would not only apply to individuals, but also to trusts.

The proposed increase in the inclusion rate is part of the government's plan to raise additional revenue to fund new spending initiatives. The government estimates that the increase in the inclusion rate would generate $2.1 billion in additional revenue over the next five years.