Canadians will soon receive a temporary tax break on essential items, children’s clothing and diapers, restaurant and pre-prepared meals and common stocking stuffers, Prime Minister Justin Trudeau announced Thursday.
The two-month Goods and Services Tax/Harmonized Sales Tax (GST/HST) break will apply across the country, and is aimed at addressing lingering affordability concerns, according to the federal government.
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“Canadians have been through a lot. They work hard. We see that. We’ve been able to get through the past couple of years. Everyone had to tighten their belts a little bit. Now we’re going to be able to give a tax break for all Canadians,” Trudeau said.
Among the dozens of consumer goods the government’s offering relief between Dec.14 and Feb. 15 are:
- Prepared salads, sandwiches, and similar pre-made platters
- Dine-in, takeout, or delivery restaurant meals
- Cakes, pies, doughnuts, brownies, and other pastry items
- Beer, wine, ciders, coolers and certain non-alcoholic drinks
- Candies, chocolate, gum and related sweets
- Chips, cheese puffs, popcorn, and similar salted snacks
- Ice cream, other frozen treats, and pudding
- Fruit bars and granola products
- Doll houses, toy cars, Lego, and action figures
- Children’s clothing, footwear, car seats, diapers
- Video-games, consoles, and controllers
- Jigsaw puzzles and board or card games for all ages
- Print newspapers and select types of books
- Christmas trees natural or artificial
The prime minister also announced a new “Working Canadians Rebate,” alongside Deputy Prime Minister and Finance Minister Chrystia Freeland, in Sharon, Ont.
The pocketbook-focused policy announcement was first reported by The Globe and Mail.
Who qualifies? How will it work?
As of Dec. 14, businesses are expected to remove the GST and the HST on qualifying goods at checkout. The HST is only charged in select provinces, including Ontario, Newfoundland and Labrador, Nova Scotia, New Brunswick and Prince Edward Island.
According to the federal government, the tax relief will cost $1.6 billion, and save a family spending $2,000 on qualifying goods $100 over the two-month period.
The “Working Canadians Rebate” will send a $250 payment to 18.7 million Canadians in early spring 2025. Trudeau said his government intends to see these “relief” cheques roll out in April.
The Canada Revenue Agency will deliver the rebates directly, either through direct deposit or cheque.
NDP taking credit, legislation needed
Last week, NDP Leader Jagmeet Singh pledged his party would eliminate the GST on daily essentials and monthly bills, if elected.
The temporary GST relief the Liberals are offering will not apply to monthly bills.
Late Wednesday, after being briefed on the upcoming announcement, the NDP issued a statement, taking credit for the policy.
“The NDP is delivering a winter tax holiday to Canadians. The prime minister’s office just informed us that he’s caving to our Tax-Free-Essentials campaign — partly,” Singh said.
The statement also signalled the NDP “will vote for this measure because working people are desperate for relief, and we’re proud we delivered for them again.”
Singh is expected to react to Trudeau’s announcement, on Parliament Hill at 12:30 p.m. EST. Conservative Leader Pierre Poilievre has also called a press conference, for 12 p.m. EST.
The affordability measures will require legislation, which means the Liberals need support from another party to break the current two-month standstill in the House of Commons.
The impasse is over the government’s refusal to hand over documents related to a now-defunct green tech fund. No legislation can pass until debate on that issue ends, and a second waiting privilege motion regarding Randy Boissonnault’s ex-business partner is dealt with.
According to the NDP, after weighing its options over whether to support the Liberals and break the stalemate in the House of Commons, the party says it’s plan isn’t to help end it, rather they said they’ve found a workaround.
A source speaking on background told CTV News that they intend to try to pause debate for a day, and use a programming motion to pass these measures through all stages in an expedited manner, before allowing the procedural debate to resume. It remains to be seen exactly how, or when this would unfold, thought the NDP said it’s ready to sit longer hours to make it happen.
Since Singh tore up the two-party supply-and-confidence pact in September, the NDP have gone vote-by-vote on helping keep the minority government afloat, but they are now the only party willing to continue doing so, as both the Conservatives and Bloc Quebecois are ready to trigger an early election.
“I really hope that all parties in the House get behind this, so we can pass this quickly, so that Canadians can get this relief as soon as December 14,” Trudeau said.
This is a developing story. More details to come.
With files from CTV News Chief Political Correspondent Vassy Kapelos and Jeremie Charron