In response to the criticism, Freeland’s office said it was in search of capital gains changes to supply justice for younger Canadians battling the fee of living.
Small business owners see tax changes
The budget also included a brand new program that can reduce the tax burden some small business owners face after they sell their businesses. Those who qualify will only be taxed on one-third of their capital gains as much as $2 million.
What. Are. We. Do 🇨🇦?!? https://t.co/P6LVwloaUM
—Harley Finkelstein (@harleyf) April 16, 2024
Several Shopify Inc. executives, including President Harley Finkelstein, posted on X concerning the capital gains changes Freeland proposed. Hours after the budget was released, he wrote: “What? Are. We. Do?!?”
We must do every little thing we will to make Canada the most effective place to be an entrepreneur 🇨🇦
What is envisaged within the federal budget may have exactly the other effect. Innovators and entrepreneurs will suffer and their success will likely be punished – this shouldn’t be a wealth tax,…
—Harley Finkelstein (@harleyf) April 17, 2024
“This is not a tax on wealth, but a tax on innovation and risk-taking,” he added on Wednesday. “Our political failures are America’s gains.”
Tobi Lütke, chief executive of the Ottawa-based e-commerce giant, also chimed in, saying a friend had written to him: “Canada has heard rumors of innovation and is determined to leave no stone unturned to deter them.”
Forbes estimates Lütke’s net value at $6.4 billion. While he has turn into more vocal in his criticism of the federal government’s policy decisions in recent months, he previously chaired a digital strategy table that met in 2018 and hosted Trudeau at his company’s conference.
Meanwhile, the top of the Canadian Venture Capital and Private Equity Association said on LinkedIn that the capital gains changes had “stunned” her.
“This measure, which effectively taxes innovation and risk-taking, will significantly dampen Canada’s entrepreneurial spirit, slow economic growth in key sectors of our economy and impact job creation,” said Kim Furlong. “Such a policy change undermines Canada’s position to attract the talent needed to grow and scale businesses here.”
Furlong vowed to “work tirelessly to reverse the decision.”
AI technology in Canada
Alison Nankivell, executive director of the MaRS Innovation Center in Toronto, saw this response to the budget as reflecting the tug-of-war that may pit fairness against economic opportunity. “In some ways, what you hear from the entrepreneurial community is that the balance may not be where they want it to be in terms of the ability to build a business,” she said.
The tensions obscured a number of the advantages for the sector that she saw within the budget. For example, the federal government allocated $2.4 billion to extend artificial intelligence (AI) capability, with most of it earmarked for a fund that might increase access to computers and technical infrastructure.
