SoVote

Bill C-240

44th Parl. 1st Sess.

June 08, 2022

Bill C-240 is a proposed amendment to the Income Tax Act in Canada. Its purpose is to provide an exemption from capital gains tax for certain donations made to charities involving real estate or private corporation shares. If passed, this bill would allow individuals to donate these assets to charities without having to pay capital gains tax on the appreciated value of the assets. The exemption would apply if certain conditions are met, including the donation being made to a qualified charity within 30 days of the disposition, and the taxpayer being a resident of Canada. The bill also includes provisions for cases where the taxpayer is deceased and when the taxpayer or qualified donee acquire the property after the disposition. The bill aims to incentivize charitable giving by providing tax benefits for donating real estate or private corporation shares to charities.

Steelman argument in favor of Bill C-240: One possible steelman argument in favor of Bill C-240 is that it incentivizes charitable donations of real estate or private corporation shares by providing an exemption from capital gains tax. This exemption can encourage individuals and corporations to donate their assets to charities, leading to increased funding and support for important social causes. By exempting capital gains tax on these types of donations, Bill C-240 removes a potential financial barrier for donors who may have otherwise hesitated to contribute. This can result in a higher number of charitable donations, which can have a positive impact on communities and organizations in need. Furthermore, this exemption encourages the efficient allocation of resources by allowing individuals and corporations to redirect assets that may otherwise remain unused or underutilized towards charitable purposes. By mobilizing these assets

A steelman argument opposing this bill could be as follows: The proposed amendment to the Income Tax Act, which provides an exemption from capital gains tax for certain arm's length dispositions resulting from the donation of real estate or private corporation shares to charities, may have unintended consequences. While the intention behind the amendment is to incentivize charitable donations and support philanthropy, there are potential negative effects that should be considered. Firstly, this exemption could disproportionately benefit high-income individuals who have the means to make substantial donations of real estate or private corporation shares. Lower-income individuals may not have the same assets or financial resources to take advantage of this tax break and may feel left out or discouraged from charitable giving. Furthermore, the amendment could potentially lead to a decrease in government revenue. By exempting capital g