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Capital Gains Tax Preferences Benefit Speculative Corporations and Very-High Income Individuals
Capital gains income is starkly concentrated among the richest 1.5% of Canadians, and corporate sectors with non-existent job-creation. They are the main beneficiaries of special loopholes which reduce taxes on capital gains.
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Self-Interest of Wealthy Investors Explains Over-the-Top Reaction to Capital Gains Reform
The federal government’s 2024-25 budget included an important reform to the taxation of capital gains. Capital gains occur when an asset is sold for more than it cost to acquire. Capital gains are heavily concentrated among high-income Canadians – more so than any other form of income. And making matters worse, they receive lucrative tax preferences: until this year, recipients only had to declare half their gains on their income tax (for a so-called ‘inclusion rate’ of 50%). The other half was entirely tax-free. In contrast, other forms of income (like wages and salaries) must all be reported on a tax return: that is, their ‘inclusion rate’ is 100%!
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Commentary on 2024 Federal Budget
Canada’s Finance Minister Chrystia Freeland tabled the 2024-25 federal budget on April 16. The one major revenue measures in the budget (a change in the partial inclusion rate for capital gains income above a threshold of $250,000 per year) has sparked great outrage from powerful financial interests – but will have no direct impact on 99.9% of personal tax filers...
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Comparing Deficits in Canada and the U.S.
Despite predictable Conservative and business complaints about ‘overspending’, Canada’s federal deficit is very small in macroeconomic terms – and one of the smallest among major industrial countries. In 2022, according to the most recent OECD cross-country data, the general government balance in Canada ranked 9th best among the OECD’s 37 member countries...
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Testimony to House of Commons Finance Committee Pre-Budget Hearings
Centre for Future Work Economist and Director Jim Stanford was invited to present testimony to the House of Commons Standing Committee on Finance, as part of its annual pre-budget hearings. Here are his opening remarks, presented on October 19, 2023.
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Austerity Can Make Debt Problems Worse
The health and economic side-effects of the COVID-19 pandemic have caused major deficits, at both the federal and provincial levels of government. With vaccinations continuing and the economy rebounding, many commentators now argue for a quick retrenchment in government spending to reduce deficits and debt. Centre for Future Work Director Jim Stanford recently presented to the CARE Conference at Memorial University in St. John’s, Nfld., on the outlook for public finances after the pandemic. A commentary based on his presentation is published here, part of the Fair Reset blog series hosted by the Newfoundland & Labrador Federation of Labour. And a video recording of his presentation has also been posted…
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Podcast on the Federal Budget, Early Child Education, and the Recovery from COVID
Centre for Future Work Director Jim Stanford was a guest in this post-budget special edition of The Herle Burly podcast, hosted by David Herle. He and fellow panelists Dr. Kate Bezanson (from Brock University) and Peter Nicholson (former head of policy for the PMO) dissected the budget’s eye-popping deficit forecast, whether deficits matter, and the economic importance of universal high-quality early child education. Watch the full discussion here. https://youtu.be/fC92ZAs4P5g Budget Panel: Bezanson, Nicholson, Stanford + the Political Panel: Byrne and Reid | The Herle Burly
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National Child Care Roll-Out Will Boost Economy More Than Budget Estimates
Today’s federal government pledge to implement a national affordable child care program will significantly accelerate Canada’s recovery from the COVID-19 pandemic and recession, according to research from the Vancouver-based Centre for Future Work. And the Centre suggests that the resulting boost to output and employment will be significantly larger than estimated by today’s federal budget. “Universal high-quality early child education is a vital ingredient in a high-performance economy, and this plan will spark job-creation and income growth across the country,” said Dr. Jim Stanford, Economist and Director of the Centre for Future Work. “In fact, the improvements in employment and GDP growth arising from the plan are likely to be…
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The Role of the Public Sector in Rebuilding After COVID-19
Canadians have understandably turned to government for protection and support during the COVOD-19 pandemic. But the public sector will also need to play a vital role in leading the reconstruction of Canada’s economy once the pandemic has subsided. This has been emphasized in previous Centre for Future Work research, including our PowerShare report on how work must be improved after COVID, and Jim Stanford’s call for a ‘post-war’ economic rebuilding strategy led by expansive government investment. In this feature interview with Cory Hare for ATA News (the journal of the Alberta Teachers’ Association), Jim Stanford explains why expanded public sector investment, service provision, and hiring will be vital to continued…
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The Debt Monsters are Awakening … but Don’t be Afraid
For the first few months of the COVID-19 pandemic, traditional voices of fiscal austerity were largely silent – even as governments began to incur very large deficits in response to the pandemic. More recently, however, prominent advocates of balanced-budgets and debt reduction have renewed calls for spending restraint. In this commentary, originally published in the Toronto Star, Jim Stanford explains why current deficits are not so “spooky” – and why focusing on deficit-reduction would make the recession worse. Trick-or-treating has been banned in several cities this Hallowe’en to limit the spread of COVID-19. But a rag-tag swarm of frightening creatures has nevertheless come out to frighten Canadians: with spooky stories…