Canada will cancel a proposed tax increase in the capital gains inclusion rate, Prime Minister Mark Carney's office said on Friday, bringing an end to a tax measure that had been widely criticized by industry.

The start of the Government of Canada's planned federal capital gains tax hike will no longer be deferred, as it will now be cancelled.

Most notably, the CRA is reverting to administering capital gains taxation under the current 50 per cent inclusion rate. As a result, the agency is telling taxpayers to wait to file their 2024 income tax and benefit returns if they’re reporting capital gains they realized last year.