SURREY, B.C. — Federal Finance Minister Jim Flaherty signalled Monday he will not eliminate the capital gains tax in his first budget.

The Conservative government had campaigned on eliminating the tax for individuals on the sale of assets when proceeds are reinvested within six months.

"With respect to this particular initiative, we will be taking some time to consult Canadians before moving forward'' he said in a speech to the Surrey Chamber of Commerce.

He later told reporters the government is consulting on various commitments the party had in its platform, including the capital gains tax.

"What I can say is that that is a particularly complex issue in terms of designing the plan,'' he said.

"I would be less than candid with you if I said that was not quite challenging to accomplish in the short term.''

The government is expected to bring down its first budget in April. Flaherty repeatedly said Monday he would not reveal what's in it.

Keith Head, who teaches at the University of British Columbia's Sauder School of Business, said the government may have chosen not to eliminate the capital gains tax at this point because the benefits would apply to a minority of Canadians at a time when Prime Minister Stephen Harper is vying for widespread appeal.

But the elimination of the tax as part of the Conservative party's election platform makes sense, he said.

"Whether you're talking about the U.S. or Canada, at the core of the party you have people who resent the very high taxation they feel they incur on their investments.

"But right, (Harper) is not all about appealing to his political core.''

The move to keep the capital gains tax would also make up for revenue lost to a lower GST, Head said.

In his speech, Flaherty said the Conservatives will reduce the GST by one percentage point immediately as promised.

He wouldn't say when the government would eliminate another percentage point.

The Conservatives campaigned on taking the GST to five per cent instead of the current seven.

"Everyone from a newspaper carrier to a senior on a fixed income will see a savings,'' he said in his speech.

"And, unlike other tax measures, no future government will be able to take this tax cut away from you by stealth.''

Flaherty said the government would lower small business taxes and create a tax incentive to hire new apprentices because of the severe shortage of trades people including plumbers and electricians.

The Conservatives plan to raise the threshold at which businesses have to pay the general corporate tax rate and will also cut the small-business rate itself within five years.

Flaherty cautioned, though, that as finance minister, he will have to make some difficult choices.

"We can't do everything at once, we simply don't have the resources,'' he said.

"Our approach will be focused, frugal and fiscally responsible."