Canada's new tax will target wealthy who buy private jets, luxury cars and yachts
Canada’s introducing a new tax next month targeting the wealthy who choose to commute via private jet.
The Select Luxury Items Tax Act goes into effect on September 1.
Anyone buying luxury cars or aircraft exceeding $100,000 and boats exceeding $250,000 will have to pay a tax that equals to 10% of the item’s full value.
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The federal government aims to discourage the ultra rich from buying heavy CO2 emitting vehicles, while also tackling inequality.
In an August 2021 news release, the government cited the “COVID-19 recession” and Canadians who have lost their jobs and small businesses.
“That’s why it is fair today to ask those Canadians who can afford to buy luxury goods to contribute a little bit more,” reads the statement.
The new tax arrives as celebrities come under fire for their environmentally unfriendly private jet usage.
The automated Twitter account Celebrity Jets has been exposing the likes of Drake, Kylie Jenner, and Taylor Swift for taking under 30-minute flights on their private jets.
Digital marketing firm Yard even ranked the 10 celebs with the worst carbon dioxide (CO2) emissions based on how often they use their private planes.
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The data reveals that overall, these celebs have emitted an average of 3,376 tons of CO2 for their private plane usage in 2022 so far.
That’s 482 times more than a regular person’s yearly emissions.
For context, it takes one person about a year to create two tons of C02 emissions and a typical passenger vehicle emits about 4.6 tons of CO2 per year.
The aviation industry has criticized the luxury tax, warning of the economic impact that it could have, and could even result in the loss of at least 900 jobs.
While the law comes into effect on September 1, any written sale agreement dated after January 1, 2022, will also be subject to the tax.
Luckily for Drake, he doesn’t have to pay the tax since he acquired ‘Air Drake’ in 2019.
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