The return of extra wealth tax propisitions isn’t a good encore for anyone

Skip to Content News Archives Economy Defence Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Defence Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Defence Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePersonal FinanceTaxesThe return of extra wealth tax propisitions isn't a good encore for anyoneThe B.C. Green Party promising a one-time wealth tax on the province's richest households plus an annual taxLast updated 17 minutes ago B.C. Green Party Leader Emily Lowan looks on during the B.C. election provincial leaders’ debate in Vancouver, B.C., on Oct, 14, 2026. Photo by Ethan Cairns/BC Broadcast ConsortiumWe independently select everything we recommend. Buying through us may earn us a commission, which supports our work.I’ve been debating whether I should take one last trip to see the Eagles at the Sphere in Las Vegas before they finally call it a career. Earlier this year, drummer Don Henley said 2026 was probably the band’s last, but they recently added the Sphere shows in January.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountFinal and one-time are flexible words in both rock and roll and in tax policy. Keep that in mind as British Columbians head to the polls on Saturday, with the B.C. Green Party promising a one-time wealth tax on the province’s richest households plus an annual tax.This advertisement has not loaded yet, but your article continues below.Why pay attention to a party polling in single digits? Because polls point to a close race, allowing the fringe to set the agenda. The Greens already propped up the NDP’s one-seat majority through a 2024 cooperation accord, and now they’re recycling old ideas. The wealth tax is the oldest of them.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againUnder the Greens’ Fair Share Act, the one-time tax on net wealth would be five per cent above $50 million, 10 per cent above $100 million and 20 per cent above $1 billion, which the party estimates would raise $22.2 billion.The proposed annual wealth tax would follow at two per cent, three per cent and five per cent on the same thresholds, raising an estimated $5.4 billion a year that less than 2,500 households would pay.The party’s FAQ greets readers with the saucy “Congratulations, you won capitalism!” That raises an obvious question: what if those winners simply leave?Its answer is that the levy would retroactively apply to the previous tax year, catching anyone who moves once the tax is announced. Households worth more than $50 million that move out of B.C. would pay an exit tax, which the Greens compare to the departure tax Canada charges people who emigrate.This advertisement has not loaded yet, but your article continues below.Think of it as B.C.’s own Hotel California: the wealthy can try to check out, but they can never quite leave.The Greens are also planning an annual sequel before the first act ends. The federal government in 2022 did the same with the ridiculously named Canada Recovery Dividend, a one-time 15 per cent tax on the average 2020 and 2021 taxable income of banks and life insurers above $1 billion. It arrived alongside a permanent 1.5 percentage point surtax.The federal budget’s roughly $4-billion estimate for the dividend fell to about $3 billion once the legislation was drafted.History has already graded wealth taxes. According to the Organization of Economic Co-operation and Development, 12 member countries levied net wealth taxes in 1990. By 2017, only four did.France scrapped its tax effective 2018 after hundreds of wealthy taxpayers left each year. Norway raised its rates in 2022, pushing 300 or so multimillionaires and billionaires to move to Switzerland by 2024. Inside Norway, the municipality of Bø cut its local wealth tax rate to attract the wealthy.Canada has its own COVID-19-era evidence. The Parliamentary Budget Officer in 2021 priced a Liberal MP’s far gentler one-time levy that called for a three per cent tax above $10 million and five per cent above $20 million. It assumed 15 per cent to 20 per cent of the wealth would be avoided, relying on research co-authored by Berkeley economist Emmanuel Saez, who has since endorsed the Greens’ plan. It warned that much of the wealth is tied to businesses that “can’t easily be sold.”This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.The Prime Minister’s Office (PMO) then requested a note on the merits of the policy. The resulting memo to the PMO called it “a complex issue,” with the government’s own analysis redacted, according to documents released under access to information requests. No federal wealth tax followed. The Greens’ top rate is four times higher.California is the original hotel. Its proposed one-time five per cent tax on billionaires goes to voters on Nov. 3. At least six billionaires, including Larry Page and Peter Thiel, reportedly cut ties with the state before Jan. 1, 2026, the residency date that determines who would pay.The Greens’ FAQ calls capital flight a “mostly-empty threat.” Yet it needs a retroactive levy and an exit tax. You don’t lock the doors against an empty threat.Nor is a provincial exit tax comparable. The federal departure tax taxes gains already accrued, subject to a variety of exclusions, and lets departing taxpayers post security instead of paying immediately. A move from Vancouver to Calgary triggers none of it, and provincial income tax already follows wherever you reside on Dec. 31.This advertisement has not loaded yet, but your article continues below.A provincial exit tax raises serious legal questions. The constitution limits provinces to “direct taxation within the province.” The charter guarantees the right to move to and live in any province and offers no cover to laws that discriminate primarily by province of present or previous residence.The Greens’ FAQ is silent on how residency would be defined and how illiquid assets would be valued.The math matters to anyone who owns a business, farm or investment portfolio. A two per cent annual wealth tax on an asset earning five per cent takes 40 per cent of the return before income tax. At five per cent, it takes all of it before inflation, and it’s due even when the asset falls in value.Assets get sold, investments go elsewhere and employees and suppliers feel it when that bill lands on illiquid wealth. The top one per cent of earners paid 22.1 per cent of all income taxes in 2023.Don Henley once famously said the Eagles would reunite when hell freezes over. They did in 1994.This advertisement has not loaded yet, but your article continues below.The Greens’ wealth tax won’t wait for hell to freeze over. Its one-time levy is just the opening act for an annual wealth tax with no farewell in sight, backed by a $22.2-billion estimate its FAQ never explains and an exit tax of questionable constitutionality. That isn’t tax policy; it’s resentment.Kim Moody, FCPA, FCA, TEP, is the founder of Moodys Tax/Moodys Private Client, co-host of Canadian Tax Matters, a former chair of the Canadian Tax Foundation and has held many other leadership positions in the Canadian tax community. He can be reached at kgcm@kimgcmoody.com and his LinkedIn profile is https://www.linkedin.com/in/kimgcmoody._____________________________________________________________If you like this story, sign up for the FP Investor Newsletter._____________________________________________________________We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.