Without indexation, capital gains are calculated by directly subtracting the original purchase price, that is the cost of acquisition (COA), and any cost of improvement (COI) from the sale price without adjusting for inflation. This change simplifies the computation but can increase the taxable gain, as it no longer accounts for the rise in property value over time. Consequently, sellers might face higher tax liabilities since the gain is now based purely on the difference between the purchase and sale prices.