08/02/2022
Calls to ‘tax the rich’ often fall on deaf ears - but Canada appears to be listening. The country is set to impose a new ‘luxury tax’ on the sale and importation of high-value cars, planes and boats.
Coming into effect on 1 September 2022, the Select Luxury Items Tax Act is billed as part of the Government of Canada’s commitment to a fairer tax system.
The levy is the realisation of budget proposals first made last summer, which have now received parliamentary approval.
Who has to pay Canada’s new luxury tax?
The new luxury levy targets certain vehicles and aircraft priced above CA$100,000 (€76,400) and certain boats priced above CA$250,000 (€191,000). It will be calculated at 10 per cent of the full retail value of the vehicle, aircraft or vessel, or 20 per cent of the value above the threshold.
The tax will only apply to new vehicles purchased by consumers for personal use. It will apply retrospectively to most sales made after 1 January 2022
