Canada Announces Temporary GST/HST Relief on Holiday Essentials

The Canadian government has announced a temporary suspension of the Goods and Services Tax (GST) and Harmonized Sales Tax (HST) on certain holiday essentials. This measure is set to take place from December 14, 2024, to February 15, 2025. The items included in this tax relief are groceries, restaurant meals, drinks, snacks, children's clothing, and gifts. The government estimates that this will provide approximately $1.6 billion in federal tax relief.

For a family spending $2,000 on qualifying goods, the GST savings are projected to be $100 over the two-month period. In provinces where the HST is also removed, such as Ontario, Newfoundland and Labrador, Nova Scotia, New Brunswick, and Prince Edward Island, additional savings are expected. In Ontario, for example, the same $2,000 basket of goods would yield HST savings of $260.

Businesses are expected to remove the GST/HST on qualifying goods at checkout starting December 14, 2024. The relief applies to goods delivered and paid for during the specified period. The tax relief also extends to the importation of these goods if they are imported during the same timeframe.

The government claims this initiative will provide significant financial relief to Canadians during the holiday season, although the exact impact on individual households will vary depending on spending habits and location.