Thank you.
Ms. Wilson, under measures introduced in the 2023 fall economic statement, the first $10 million in capital gains realized on the sale of qualifying businesses to an employee ownership trust will be tax exempt for the next few tax years, and hopefully it will be made permanent.
Under the proposed reforms contained in budget 2024, the lifetime capital gains exemption for capital gains on the sale of a small business or fishing and farming property will increase by 25% from $1 million to $1.25 million. That will be indexed to inflation after 2025.
In addition, the Canadian entrepreneurs' incentive will reduce the inclusion rate to 33.3%—so a drop—on a lifetime maximum of $2 million in eligible capital gains.
Combined with the enhanced lifetime capital gains exemption, when that incentive is fully rolled out, entrepreneurs will have a combined exemption of at least $3.25 million when selling all or part of a business. According to the government, entrepreneurs with eligible capital gains of up to $6.25 million will be better off under these changes.
Do you disagree with those assertions?