Before I answer your question, I'd like to clarify what I said earlier.
When someone gets an inheritance, they don't realize any capital gains. They can only realize $250,000 in capital gains when they sell their own property. Capital gains are processed after death. The deceased pay tax on their capital gains, but their heirs do not, unless the property they inherit further appreciates before they sell it.
In terms of our own proposal, we feel that an inclusion rate higher than 66% would certainly have been a viable option. Other witnesses have mentioned this as well. Instead, in our minds, the deduction for the sale of small business corporation shares or farm or fishing property should be merged and a full exemption for capital gains should be provided, but subject to an individual lifetime limit. That keeps us from having to wonder whether $250,000 is the right threshold. Having a lifetime limit allows people to realize a certain amount of capital gains that won't be taxable, but all capital gains thereafter would be taxable. At that point, the reform would be firmly focused on redistribution.
It would also allow us to include the principal residence issue. We don't talk about it a lot, since people don't pay tax on the sale of a principal residence, but it's an unlimited tax benefit. In fact, most of the value of that benefit goes to people who have properties that are very valuable, who resell them at a much higher price and who do so several times in their lifetime. Most Canadians don't do that. Normally, they will sell one or two properties in their lifetime. So they would do very well if that $250,000 we're talking about today or even an individual lifetime limit were there. We would then go collect something from those who sell luxury properties several times over, presumably for speculation.