The wealth steal

Hey, recall when the CRA started asking you about your house deal?

That was nine years ago. Prior to that, selling your family’s home was nobody’s damn business but yours. However, in 2016 it became Justin Trudeau’s concern. In fact, that tax break on money made selling a principal residence now depends on reporting it on your tax filing.

It also opened the door to the government establishing a huge new data base of residential real estate valuations and transactions, as well as greasing the way for new levies – like the UHT (which Mark Carney just trashed).

Darkly, this pathetic yet subversive blog (with great abs) suggested this trove of info could be useful if the feds ever decided to usher in a wealth tax. In this country, of course, a very large chunk of personal net worth is made up of residential real estate – which has grown insanely valuable. So if, for instance, Canadians ever lost their minds and elected an NDP government this data would prove useful in deciding who to whack.

(The Dippers are on record in demanding the country have a 1% wealth tax on total family net worth above $10 million. They say it would raise an astonishing $94.5 billion annually. The Greens have the same policy, “to fund public services, reduce inequality, and ensure fairness in the tax system, aiming to generate substantial revenue for social and climate investments.”)

Now, social media has lately been lit with fears that (a) a wealth tax is coming and (b) it’ll be calculated on everything – including your unsold house, your uncollected pension and unrealized gains in your TFSA or non-registered investment accounts.

“Do you know anything about the possibility and more importantly the probability that would require Canadians to report their net worth?” Heather in Vernon asks me, in a funk.

“I heard about this recently which said we would have to report every last thing we owned and owed including accurate valuations, how we got it, where assets are located, etc.  Errors not allowed or you could be penalized.  The idea, so it said, was to make taxes fairer.  I was stunned.  I only trust your opinion.  I can’t go by everything that is on YouTube but this one has me worried.”

YouTube? Seriously. That’s for cat videos and Nazi influencers. One word for you, Heather: delete.

Now what are the odds of such a thing? And, by the way, who in this country is ‘wealthy’ and deserves to be saddled with an extra tax on every asset owned?

‘Basic’ millionaires in Canada include a lot of people, since residential real estate is part of that broad definition. You might not have a lot of liquid assets, but if you own a pile in Kits or Forest Hill, you’re wealthy in the eyes of the electorate. Added to that net worth would be pension value and everything in an RRSP or portfolio. In contrast, the financial biz considers a millionaire to be someone who is HNW (high net worth) with at least seven figures in investible assets, apart from real property.

So, to be in the top 10% of Canadians, a total net worth (house included) of $2 million is the threshold. The top 5% have a net worth of just under $3 million. And the average net worth of the lofty 1% is about $7.5 million. Of course, the 0.1% folks may have tens of millions, but they’re rare indeed. (Unlike in the USA.)

By the way, all together we are worth $18.4 trillion, says StatsCan, and our collective net worth surged $461 billion in the third quarter. We’ve just had the largest increase in net financial assets ever ($491 billion) thanks to the surging stock markets on Bay and Wall Streets. This helped overcome a $53 billion drop in the value of real estate, and a $40 billion increase in household debt.

In short, people who depend solely on the value of their homes to build wealth, are currently losing. Those with liquid assets exposed to financial markets, are winning. And the wealth gap just keeps on gapping larger.

But back to a wealth tax. Make sense?

To the guys at BC Policy Solutions – home to Canada’s most outrageous real estate values – it does. They want that 1% tax slapped on family net worth of over ten million, which they claim would generate almost $40 billion in new cash for Otttawa.

“Based on modelling of the first year of this wealth tax, the bottom 99.4% of Canadians would pay nothing, while only the richest 0.6% would pay any amount. This means that only roughly 100,000 families across the country would pay any amount under the wealth tax.”

So, Heather, even if the whackos gain office such a tax is unlikely to impact you. However, once in place, a $10 million threshold could be reduced to eight million and maybe – eventually (once the pissy little Gen Zees take over Parliament) – to a number much lower.

Never forget. You’re richer than you think. But not them.

About the picture: “By way of introduction, we’ve met before as I was one of the Planetcast crew engaged on the WorkdayTV work back in 2001!” writes Reinier, harking back to a debut moment in live streaming.  “I was able to parlay that experience into a few more hops, and am now still working in tech, as a Product Manager at Oracle. Thought I’d send you some dog photos – these might be suitable for your end of year forecast “The Outlook for 2026” , as he’s looking outward from my East York slanty semi! This little guy is named Phantom and is now becoming a senior.  He doesn’t live with me, but visits often, and is the bestest boy ever! Thanks for the blog all these years, I remain a very regular reader.”

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2025/12/17/the-wealth-steal/