As I was noting in my remarks, I think that to the extent that you are taxing capital income and spending that on public services, jobs and infrastructure, you're going to have actually a progrowth orientation to that policy.
My sense is that a lot of the arguments that have been made during the neoliberal era of tax reforms, particularly in the 1990s and early 2000s, have largely been chasing microeconomic efficiency gains in the name of boosting productivity or economic growth. By and large, those misunderstand the overall process of investment and what drives that.
We should be mindful of some of the concerns that have been raised. However, I'm not seeing any evidence that this is actually the case, particularly in an area like housing, as has been raised.
There are a lot of different factors that drive investment in housing, and housing investment is down right now, primarily because interest rates are up. However, the cost of construction is up as well. The cost of land is up. There are municipal fees that need to be paid, and then there are developer profits that need to be made on top of all that. All of those things determine the hurdle rates for ownership for a rental property [Technical difficulty] going to be developed.
At the end of all of that, there may be some capital gains made, but those tend to be a residual. They're more like a windfall, so actually taxing them is a fair way of going about that. That's why a lot of economists favour increases in capital gains taxes.