Capital gains tax hike to yield less than 40% of revenue forecast by Liberals: C.D. Howe report

Weaker-than-expected revenue gains would raise questions about the benefits of the tax changes, which have faced widespread criticism

Canada’s decision to increase the capital gains inclusion rate is unlikely to generate as much cash as Justin Trudeau’s government expects, a research group says.

The changes will add a net $3.3 billion to federal government revenues from individuals over five years, according to a paper being released Thursday by the C.D. Howe Institute.

That’s less than 40 per cent of the $8.8 billion forecast by the government when Finance Minister Chrystia Freeland proposed the tax changes in April.