Health Minister Mark Holland says that while he is “deeply grateful” for the work doctors do in Canada, the federal government has no plans to scrap proposed capital gains tax changes outlined in the latest budget, despite opposition from the Canadian Medical Association (CMA). .
“I think these are fair changes, there are still a lot of tax advantages, accrued advantages that will remain and continue,” Holland told CTV Question Period host Vassy Kapelos in an interview broadcast Sunday.
The budget proposes increasing the capital gains inclusion rate from 50 percent to 67 percent for people who earn more than $250,000 in capital gains in a year, and for all corporations and trusts, without that minimum threshold.
That means the portion of capital gains that is subject to tax is increasing, a change the government says will generate more than $19 billion over the next five years.
But doctors have expressed concern about the proposal, warning that it could undermine their retirement plans because many of them incorporated their medical practices.
Prime Minister Justin Trudeau has dismissed concerns, saying the change is about “fairness,” while Dr. Kathleen Ross, director of the CMA, told CTV News’ Power Play that it feels like a “beating” for a country “already morally defeated.” and the beleaguered medical staff emerging from the pandemic.”
He said provinces “encouraged” family doctors 15 to 20 years ago to join as a “retirement savings vehicle”… “in lieu of rate increases at the time.” Ross added that the CMA estimates that around eight per cent of doctors’ retirement savings will be “captured” by the tax change, which he called “substantial”.
According to the CMA, more than two-thirds of Canada’s physicians are incorporated.
Asked by Kapelos whether comments from the prime minister and cabinet ministers could be interpreted as meaning doctors would be forced to pay more to subsidize government spending, Holland said “not at all.”
“I deeply appreciate the work that doctors and nurses do, personal support care workers; the work that everyone in our health system does is absolutely extraordinary,” Holland said, adding that the intent behind the tax increase capital gains is to make those who have “seen their wealth grow enormously” pay more to reduce the “enormous disparity” in society.
Kapelos then pressed further, asking whether Holland believes doctors deserve to keep more of the wealth they have worked for.
“Of course they work for their assets,” Holland said. “But look, we can choose what kind of society we live in. Do we want to be in communities where there are huge discrepancies?”
According to the Canadian Institute for Health Information, the average gross payment per doctor in Canada in 2022 was $357,000, including family doctors, specialists and surgeons. But incorporated physicians also pay their staff and practice overhead with that amount.
Holland said, however, that “misinformation” is circulating about the impacts of the capital gains tax change on physicians, and that despite the inclusion rate increase, there are still many tax benefits to incorporation.
“We obviously want to work with them to make sure — and I know they care deeply about this justice within the country as a whole — that we are investing in things like health care and that there is a health system that is there. , that they are working on, that is working well for them and for their patients,” he said.
With files from CTV’s Question Period Senior Producer Stephanie Ha