Canada's Trudeau government requests that rich compensation more in pitch to Gen Z

Canada’s Trudeau administration is appealing to the affluent for increased contributions in a bid to gain favor among younger voters, particularly Gen Z, in anticipation of an upcoming election. Finance Minister Chrystia Freeland, during the annual budget presentation on Tuesday, advocated for higher taxes on the wealthiest citizens. 

The proposed budget allocates CAD 53 billion ($38bn USD) for various initiatives over five years, with a significant focus on Millennials and Generation Z. These initiatives include affordable housing, student financial aid, rent assistance, and employment programs.

One notable proposal is an increase in the tax rate on capital gains exceeding CAD 250,000 (USD 180,804) to 66.7 percent, up from 50 percent, projected to generate nearly CAD 20 billion ($14.5bn USD) in revenue over five years. Freeland emphasized the struggle of younger generations to attain the lifestyle their parents enjoyed, citing the widening gap between aspirations and attainability.

While acknowledging potential opposition to the tax hike, Freeland asserted that it ensures a fairer distribution of the tax burden among the affluent. However, the Business Council of Canada (BCC) criticized the budget, arguing that wealth redistribution doesn't foster economic growth.

The success of the budget relies on the support of the New Democratic Party to pass through parliament. Trudeau’s Liberal government faces stiff competition from the Conservatives, led by Pierre Poilievre, in the upcoming elections, with Trudeau's popularity waning due to concerns over the cost of living and housing affordability.

Trudeau recently announced plans to construct nearly 3.9 million houses by 2031 to address the housing supply-demand gap, responding to widespread discontent over housing affordability.