Finance Minister François-Philippe Champagne is scrapping the Trudeau government’s unpopular luxury tax on private planes and boats, calling it a move to “improve efficiency” and help struggling industries. Blacklock's Reporter says a separate federal tax on vacant foreign-owned housing is also being repealed after officials admitted it was never collected.The repeal takes effect immediately, ending a 10% surtax first introduced by former finance minister Chrystia Freeland in 2021 on aircraft and vehicles worth more than $100,000 and boats worth over $250,000. The finance department said the change would “provide relief to the aviation and boating industries” while making the tax system more streamlined.Freeland had defended the measure at the time as a way for the wealthy to “contribute a little bit of that good fortune” to the post-pandemic recovery. .But the tax collected less than expected — $137 million in its first six months, compared to the $150 million annual take forecast by the Parliamentary Budget Office.Cabinet is also scrapping the so-called Underused Housing Tax, a 1% annual levy on foreign-owned vacant homes that was passed in 2022 but never enforced. The finance department said the repeal will “simplify Canada’s tax system” and reduce costs for both government and taxpayers, noting other restrictions such as the federal foreign buyer ban and municipal vacancy taxes already target speculative ownership.Despite being described by Freeland as a tool to “keep housing out of the hands of speculators,” internal government records show the program produced billions in waivers and no actual revenue. .A briefing note last fall said the waivers totaled $2.8 billion, almost all tied to the unused housing tax.The Canada Revenue Agency confirmed 578,910 foreign property owners filed disclosure forms, but 478,220 of them “had no amounts owing.” The federal government still spent $59 million administering the paperwork, assigning 351 employees to a tax that never brought in a cent.
