After discussing her short- and long-term goals, Murray tells Virginia that he is concerned about her current tax situation. He asks her to confirm that for tax purposes, her cost base for the shares that she inherited from Richard was virtually zero. When she does, he reminds her that Canada has no inheritance tax but a capital gains tax in which one-half of the capital gain is taxable at the individual’s marginal tax rate on the disposal of the property.
Q. The nature of the tax affecting Virginia that concerns Murray is most likely described as a tax on:
- value added
Correct answer is income.
My question is: why? Could someone pls tell? It is clearly not wealth, nor value added, however, I would have classified it as “capital gains”?