Poilievre Proposes A “U.S. Style” Capital Gains Deferral

What’s Being Proposed?

As part of his election platform, Poilievre has introduced a concept called the Canada First Reinvestment Tax Cut, which would allow individuals and businesses to defer capital gains taxes if they roll the proceeds into Canadian-based investments—either real estate or active businesses. Taxes would be payable when the investor ultimately cashes out or moves the capital out of the country. 

The concept differs from the U.S. model in that it is not limited to real estate transactions or require a “like-kind” property exchange. 

The program is proposed to run for a limited window, starting July 1, 2025, and ending December 31, 2026.

How the Program Would Work

Take this example: Let’s say an investor sells a small multifamily property for $950,000, with $180,000 in capital gains. Currently, nearly $45,000 could be owed in taxes. But under the proposed plan, during the July 1, 2025, to December 31, 2026 period, that money could instead be reinvested into a mid-sized mixed-use building or a growing Canadian business, deferring the tax.

Investors could use this program to leverage purchasing power and greater liquidity after a sale, which could help with scaling real estate holdings. 

How the Program Differs from the U.S. 1031 Exchange

Although Poilievre’s proposal and the US 1031 exchange both focus on capital gains tax deferrals, there are differences. While the 1031 exchange focuses strictly on real estate and has detailed rules around property type and timing, Poilievre’s version, as it is proposed now, appears more flexible. There’s no requirement for the reinvestment to be in a “like” asset, and the timeline isn’t tied to short windows like 45 or 180 days.

A Tool for Growth—But Not Without Questions

Though the proposal is attracting attention, it’s still early. Details around eligible asset types, reporting requirements, and what qualifies as an “active” Canadian business are expected closer to the rollout date—if the policy is enacted at all.

Still, savvy investors should be watching closely. This kind of policy could reshape tax planning strategies for those holding income properties, vacation rentals, or commercial buildings.

It also has the potential to help investors reposition their portfolios without being penalized for making smart, growth-oriented decisions.

Looking Ahead

Whether or not this proposal becomes law, it signals something important: policymakers are finally acknowledging the need to keep Canadian capital working inside our borders. For real estate investors, a tax deferral option like this could unlock new levels of opportunity—especially in a high-rate environment where liquidity and flexibility are key.