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Edited on Fri Nov-26-04 07:36 AM by Iceburg
Capital taxes are applied to capital invested in machinery, equipment and buildings required to operate the business, and to the financial capital held by financial institutions to ensure their safety and soundness.
The Ontario governmenet announced that it will reduce the capital tax rate for all corporations by 10 per cent effective January 1, 2004, and will completely eliminate the capital tax at the same time that the federal government eliminates its capital tax.
Business aside, we do have a federal capital "gains" tax that applies to personal assets but only when sold.
Capital Gain: An increase in the money value of a capital asset such as a share, bond, parcel of land, antique or other asset, which results in a profit if the asset is sold. If a share is bought at $26 and sold at $30, there is a capital gain of $4.
Taxable capital gain: The portion of capital gain realized during the year that is required to be included in income. This is equal to one half of the net capital gain. If a share is bought at $26 and sold at $30, there is a capital gain of $4. The taxable capital gain is one half of this amount, or $2. This is the amount that is included in income.
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