I've been thinking about this quite a bit, and I'm still not sure why a 100% inclusion rate is a problem. (With various exemptions for primary residence sales and small business sales, maybe with a $1MM lifetime maximum? idk, just making up a number.)
Are they concerned that people just... aren't going to invest their capital to earn more money if they'll be taxed on the profits? Or is this just a global "race to the bottom" that they won't invest in Canada because they can earn more if they invest elsewhere?
Maybe something like: 50% inclusion up to $100K, 75% inclusion up to $1MM, then 100% inclusion thereafter, and add a mechanism to spread capital gains over several years so people making single-lifetime large capital gains aren't treated the same as people earning millions every year.
That would still incentivize small-business creation and startups without letting multimillionaires off the hook.