Why are Canadians allowed to sell their homes tax-free while profits from stocks and investments get taxed? And is that policy making Canada’s housing crisis even worse?

In this episode of Classonomics Sabrina Maddeaux and Mike Moffatt break down Canada’s capital gains exemption on primary residences, why it exists, why politicians are terrified to touch it, and whether it’s contributing to skyrocketing home prices and inequality between homeowners and renters.

They explore the history of the tax exemption, why attempts to change it spark political outrage, how other countries handle housing taxes, and whether taxing home profits would actually make housing more affordable. Plus, they discuss property taxes, downsizing, investor advantages, generational inequality, and why even “common sense” housing reforms have become politically impossible in Canada.

Topics covered:

• Canada’s capital gains exemption on homes
• Housing affordability and inequality
• Why homeowners are politically powerful
• How other countries tax housing wealth
• Property taxes and downsizing
• Investors vs families in the housing market
• The politics of housing reform in Canada
• Why fixing housing has become so difficult

#Canada #HousingCrisis #RealEstate #Taxes #HousingMarket #CanadianPolitics #Economics #TheMissingMiddle

Chapters:

00:00 Why Canada Doesn’t Tax Gains on Your Primary Home
01:17 Why Politicians Won’t Touch the Primary Residence Exemption
04:06 The History of Canada’s Capital Gains Exemption
05:28 How Other Countries Handle Housing Capital Gains
07:25 Does the Exemption Actually Worsen the Housing Crisis?
10:39 The Case Against Taxing Primary Residences
13:26 Better Alternatives: Tax Fairness Without Capital Gains Reform
16:06 Why Even Good Housing Policy Can Be Politically Impossible

Research:

Canada should look to Australia on eliminating barriers to downsizing for seniors

https://www.theglobeandmail.com/investing/personal-finance/article-housing-baby-boomers-suburban-homes-young-families/

CBC article from a few years ago: https://www.cbc.ca/news/politics/the-conservatives-misleading-claims-about-a-secret-liberal-housing-tax-1.5312873 

26 of 40:

https://view.asiae.co.kr/en/article/2022032109551988175 

History of cap gains taxes:

https://www.ctf.ca/EN/EN/Newsletters/Perspectives/2021/3/210304.aspx

Hosted by Mike Moffatt & Cara Stern & Sabrina Maddeaux

Produced by Meredith Martin

Funded by the Neptis Foundation https://neptis.org/