Canada's Growth Incentive wins praise from angel investors: $15M capital-gains exemption for Canadian startups

Canada's National Angel Capital Organization (NACO) said on November 6 it welcomes the Canada Growth Incentive, a new tax measure proposed in Budget 2026. The measure exempts up to $15 million in capital gains for qualifying individuals selling shares in eligible Canadian companies, and expands the small-business rollover, encouraging investors to back Canadian companies from the very first cheque.

Budget calls it a key incentive to keep builders in Canada

The budget describes the incentive as "one of the most significant incentives to attract and retain builders here in Canada." The Finance Department said it pairs the exemption with an expanded rollover so founders and early investors can recycle the proceeds of a successful exit into the next generation of Canadian companies. NACO chief executive Claudio Rojas said the organization welcomes the government's recognition of the role founders and angel investors play in building Canada's next generation of companies.

October open letter called for the reform

NACO said it joined more than 500 signatories in an open letter in October to Finance Minister François-Philippe Champagne calling for these reforms. The organization will hold a national briefing on November 10 with Ryan Turnbull, Parliamentary Secretary to the Minister of Finance and National Revenue. Eligibility conditions apply, as set out in the budget documents.

Budget backdrop: $142.1B in new measures, $62.3B deficit

Budget 2026, titled "Masters of our Destiny," was tabled in Parliament on November 5, setting out $142.1 billion in new measures over five years and projecting a $62.3-billion deficit for 2026–27. One of its three main pillars is an "investment supercycle," including a productivity mega-deduction letting businesses immediately write off the full cost of eligible capital assets, cutting Canada's marginal effective tax rate on new business investment from 13 per cent to 6.4 per cent — which the government says makes Canada more tax-competitive than the United States for new investment.

(Sources: NACO statement via GlobeNewswire; Budget 2026 coverage. Photo: file photo of Parliament Hill, Ottawa.)