Business leaders want capital gains deferral to keep money in Canadian firms

TORONTO — A coalition of Canadian business leaders, comprising over 150 investors and executives, has penned a letter to Finance Minister François-Philippe Champagne, advocating for tax policy reform aimed at stimulating investment in domestic enterprises. The signatories urge the government to contemplate two measures they believe will foster entrepreneurship within the nation.

The first proposal involves implementing a policy similar to the U.S. qualified small business stock incentive, which permits capital gains from qualifying small business stocks to be exempt from federal taxation. The second suggestion revolves around permitting entrepreneurs and investors to postpone capital gains tax payments when proceeds from certain domestic business transactions are reinvested into another Canadian venture.

The coalition asserts that deferring, but not wholly eliminating, the tax would motivate successful business owners to reinvest their earnings back into the economy instead of withdrawing funds. This coalition, spearheaded by the Canadian Venture Capital and Private Equity Association and the Council of Canadian Innovators, aims to reduce investment barriers and enhance funding for startups.

The report, originally published by The Canadian Press on October 6, 2026, provides a comprehensive account of the signatories' plea for tax policy reform.