Real Estate

Trudeau planning to tax gains on personal residence?

  • Last Updated:
  • Nov 26th, 2022 7:19 pm
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ssj4_ootaku1 wrote: It's an OPINION.
But it does look like Trudeaus bought and paid for media are ramping articles like this to soften the blow. Where there's smoke....
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May 12, 2014
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ssj4_ootaku1 wrote: It's an OPINION.
And a terrible one at that.

Doesn't even address the fact that almost everyone who sells a house uses the money to buy a different house (bigger or smaller family, job in different city).

So if cap gains are taxed, you can't even afford to keep a same size house when you move, which will greatly reduce mobility.


Nor does it deal with the fact that almost everyone has planned their retirement life around the fact that their home equity won't be taxed. Not everyone could afford to pay both mortgage and RRSP. So after 40 years of savings the government destroys your retirement plan?
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cartfan123 wrote: But it does look like Trudeaus bought and paid for media are ramping articles like this to soften the blow. Where there's smoke....
Hes already in deep you know what... the tax would be the death knell.
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Would be the end of him.
[OP]
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FrancisBacon wrote: And a terrible one at that.

Doesn't even address the fact that almost everyone who sells a house uses the money to buy a different house (bigger or smaller family, job in different city).

So if cap gains are taxed, you can't even afford to keep a same size house when you move, which will greatly reduce mobility.


Nor does it deal with the fact that almost everyone has planned their retirement life around the fact that their home equity won't be taxed. Not everyone could afford to pay both mortgage and RRSP. So after 40 years of savings the government destroys your retirement plan?
It has some merit.

Jon Bon Jovi bought a $10M house 2 years ago and sold it for $20M...which he plowed into a $42M mansion. Should his $10M gain be tax-free?
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May 7, 2015
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taxrage wrote: It has some merit.

Jon Bon Jovi bought a $10M house 2 years ago and sold it for $20M...which he plowed into a $42M mansion. Should his $10M gain be tax-free?
yes
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taxrage wrote: It has some merit.

Jon Bon Jovi bought a $10M house 2 years ago and sold it for $20M...which he plowed into a $42M mansion. Should his $10M gain be tax-free?

how much tax should he pay?
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May 29, 2020
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I don't see a problem with this, as long as there is a buffer, say first 500k capital gain are fully exempt, then x% inclusion past that.
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Nov 13, 2013
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This seems unlikely. Any kind of tax reform is unpopular unless you do it like Trump and reduce revenues by a massive amount so almost everyone is better off. Even something revenue neutral like taxing gains on primary residence and reducing income taxes would cause a lot of anger. In the current environment where the government needs money any reform would probably need to increase revenue. Personally I think the first thing should be to restore the GST to 7%. I prefer this to income tax increases as I think it is more efficient and top rates are getting to the point already where they cause economic harm.
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Jul 17, 2018
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taxrage wrote: It has some merit.

Jon Bon Jovi bought a $10M house 2 years ago and sold it for $20M...which he plowed into a $42M mansion. Should his $10M gain be tax-free?
If it's his primary residence? I actually think it should be tax free. Your primary residence isn't always or usually an investment. The goal usually isn't to generate a capital gain. If you bought a 1bedroom condo when you were single, sold it to buy a 2 bedroom condo when you were married and have a baby coming, and sold it to buy a townhouse when you have kid #2 on the way, should you be taxed every step of the way just because your home increased in price over the years? Is it fair if the price for a bigger place increased at a greater rate over the years so that the upgrade in space cost you proportionally more money? I don't think that's the type of Canadians to tax more of.
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GooseAkuma wrote: If it's his primary residence? I actually think it should be tax free. Your primary residence isn't always or usually an investment. The goal usually isn't to generate a capital gain. If you bought a 1bedroom condo when you were single, sold it to buy a 2 bedroom condo when you were married and have a baby coming, and sold it to buy a townhouse when you have kid #2 on the way, should you be taxed every step of the way just because your home increased in price over the years? Is it fair if the price for a bigger place increased at a greater rate over the years so that the upgrade in space cost you proportionally more money? I don't think that's the type of Canadians to tax more of.
Well a capital gain is a capital gain. It's money you have made. Now you can argue taxation is theft or some other libertarian crazy right wing idea but if we are going to have taxes we can certainly debate what is taxable and what isn't. You can deduct your expenses and capital gains are only 50% taxable so it's not crippling for the most part.
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I can't read the article. It tells me to support quality journalism for $1.99

And why did this post get downvoted? You guys don't like an opinion piece? My bet is it's coming, but to make it fair they should definitely Grandfather the tax. It should under any circumstances be retroactive.
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taxrage wrote: Jon Bon Jovi bought a $10M house 2 years ago and sold it for $20M...which he plowed into a $42M mansion. Should his $10M gain be tax-free?
Of course. And why not? What principle would you use to tax him? That it's an expensive house?

Food is tax free. Would you tax him if he chose to eat lobster every day instead of hamburger?



Other reasons this is a terrible idea:

* A large part of the capital gain is simply due to inflation. This is true for all capital gains of course, but is particularly true for primary residences historically (in part because of how long they are held).

* If we're talking capital gain, then you must be allowed to deduct (or capitalise) expenses: maintenance, but of course property tax as well. So everyone is going to have to start keeping "business" records on their house for decades?
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Oct 28, 2018
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FrancisBacon wrote: Of course. And why not? What principle would you use to tax him? That it's an expensive house?

Food is tax free. Would you tax him if he chose to eat lobster every day instead of hamburger?



Other reasons this is a terrible idea:

* A large part of the capital gain is simply due to inflation. This is true for all capital gains of course, but is particularly true for primary residences historically (in part because of how long they are held).

* If we're talking capital gain, then you must be allowed to deduct (or capitalise) expenses: maintenance, but of course property tax as well. So everyone is going to have to start keeping "business" records on their house for decades?
I'm sorry, did you just try to argue that a $10 million increase in house price was due to inflation? By extension, would you argue that the insane yoy gains in the GTA/GVA are by any stretch of the imagination proportional to the paltry rate of inflation we've experienced over the past decade?
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Feb 12, 2006
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Soon they are going to be taxing the water and air we breath, and a walking tax the minute you leave your house.

People need to get upset about these ridiculous tax increases. We need less government, get rid off all the pigs and scale back the public sectors employees.
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Nov 13, 2013
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FrancisBacon wrote: Of course. And why not? What principle would you use to tax him? That it's an expensive house?

Food is tax free. Would you tax him if he chose to eat lobster every day instead of hamburger?



Other reasons this is a terrible idea:

* A large part of the capital gain is simply due to inflation. This is true for all capital gains of course, but is particularly true for primary residences historically (in part because of how long they are held).

* If we're talking capital gain, then you must be allowed to deduct (or capitalise) expenses: maintenance, but of course property tax as well. So everyone is going to have to start keeping "business" records on their house for decades?
Um you know his lobster is taxed right? HST etc. (well let's stick to Canada) Not sure how it is relevant either way.

All capital gains have a portion of inflation involved. Actually trump wanted to change this. It's would be very complicated to account for and only being taxed at a 50% rate accounts for that.

Why do you need to be allowed to deduct expenses? You are confusing annual costs with capital gains. I can't deduct such expenses from a non primary residence when I sell. I can deduct from any income during that year. The US interest deduction is a separate matter and isn't relevant to most people anyway as they don't itemize deductions.
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May 9, 2017
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taxrage wrote: It has some merit.

Jon Bon Jovi bought a $10M house 2 years ago and sold it for $20M...which he plowed into a $42M mansion. Should his $10M gain be tax-free?
Yes he should keep the gain. Before selling the house he was Livin on a Prayer.
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Jul 21, 2013
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I agree with those who suggested there will be a grandfathered rule.

Overall, it's a good move, I'm not sure why principle residents receive special treatment. We live in a country that provides a high level of social safety net, high taxes come with that unforutnately.

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