Liberal MPs fear Justin Trudeau’s budget is a gift to Pierre Poilievre — and that the Grits are shooting themselves in the foot
Some MPs worry that Prime Minister Justin Trudeau spends too much money and has given Conservative Leader Pierre Poilievre ammunition for the next election campaign
Worry is starting to set in. Days after Finance Minister Chrystia Freeland tabled her government’s latest budget, with $53 billion in new spending and a $19-billion tax increase to help pay for it, there is concern among some Grit MPs that the Liberals are shooting themselves in the foot.
Some — in Liberal-Conservative swing ridings — worry that blue Liberals who’ve long griped Prime Minister Justin Trudeau spends too much money, will now give Conservative Leader Pierre Poilievre a second look.
Freeland’s decision to increase the inclusion rate of capital gains for corporations and those earning $250,000 a year or more from their investments is raising alarm. While concerns it will discourage investments in the economy are not unfounded, the Liberals’ proposal does include several caveats. Canadians selling their small business shares, or farming or fishing property, for example, will see their lifetime tax-free limit on capital gains increased to $1.25 million, and indexed to inflation, and a new Canadian entrepreneurs’ incentive will reduce the capital gains inclusion rate to 33.3 per cent on a lifetime maximum of $2 million. The prime minister noted Friday that entrepreneurs will be able to keep more of their first $6 million (but after that, they will be hit with a much larger tax bill).
With the business community heavily opposed to the changes, many Liberal MPs fear that in addition to benefitting Poilievre, many of their donors will turn their backs on the party, concerned that income held by corporations, the inheritance passed on to their children, or the sale of income properties will now take a big hit.
Liberals have seen this scenario play out before.
