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Ottawa Backs Down on Digital Tax Dispute Amid Pressure from Trump White House

Canada has reportedly agreed to delay its planned digital services tax (DST) following pressure from former U.S. President Donald Trump’s administration, according to a recent statement from the White House. The tax, which was originally slated to target tech giants like Amazon, Meta, and Google, had been a major sticking point in U.S.-Canada trade discussions. The White House claimed Canada “caved” to U.S. demands after months of negotiations, with Trump’s team arguing the tax unfairly targeted American firms. The Canadian government, however, framed the delay as a strategic move to preserve economic stability and avoid retaliatory tariffs. Critics within Canada argue that the government’s decision reflects a growing trend of yielding to U.S. economic influence, while others say the delay is pragmatic given ongoing global talks about a coordinated approach to taxing digital revenues. The issue remains contentious, and observers are watching closely to see whether Canada will revive th...
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Federal Government Delays Capital Gains Tax Increase to 2026

 

The federal government has announced a delay in the implementation of the capital gains tax increase, pushing the effective date from June 25, 2024, to January 1, 2026. Finance Minister Dominic LeBlanc stated that this decision aims to provide certainty to Canadians and businesses as the tax season approaches.

The proposed changes would increase the capital gains inclusion rate from one-half to two-thirds for individuals with capital gains earnings above $250,000 and for corporations. However, the delay means that the new government formed after the upcoming election will likely be responsible for legislating these changes.

In addition to the delay, the government has promised to maintain or enhance existing capital gains exemptions, including the Principal Residence Exemption and a new $250,000 annual threshold for modest capital gains. The Lifetime Capital Gains Exemption will also be increased to $1.25 million, and a new Canadian Entrepreneurs’ Incentive will be introduced to encourage entrepreneurship.

This move has been welcomed by many Canadians and businesses who were seeking clarity on the tax changes. However, some critics argue that the government should admit the policy was a mistake and reverse course entirely.



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