A shopper walks in downtown Montreal on December 19, 2023. (THE CANADIAN PRESS/Christinne Muschi)
The federal government’s GST relief will begin this Saturday, providing some financial relief just before the busy holiday shopping period. Here's a simple guide to understanding how this will work and what you can expect to save.
What is the GST relief?
To help Canadians manage the rising cost of living, the government has decided to temporarily remove the five per cent federal Goods and Services Tax (GST) on certain items from December 14 to February 15. For provinces that charge a combined sales tax (HST), the full HST will be waived.
Which products will be affected?
The tax relief applies to several types of items, including:
- Prepared foods such as pre-made meals, vegetable trays, sandwiches, and salads
- Meals from restaurants, whether you dine in, take out, or have them delivered
- Snacks like chips, candy, and granola bars
- Alcoholic drinks, including beer, wine, cider, and pre-mixed drinks with less than seven per cent alcohol
- Children's clothing, footwear, car seats, and diapers
- Certain children's toys, like board games, dolls, puzzles, and video game consoles
- Some books and newspapers
- Christmas trees
What’s excluded from the relief?
Although many products qualify, there are some exceptions. Vending machine snacks, cannabis products, dietary supplements, and food ordered from vending machines won’t be exempt from GST. Also, sports equipment, clothing for activities like wetsuits and skates, adult clothing, and certain toys or collectibles for adults are not eligible.
What if my province uses HST?
In provinces like Ontario and those in the Atlantic region, where sales taxes are harmonized, the full HST will be waived on eligible items.
How does it work at checkout?
The tax relief will be applied automatically during checkout when purchasing qualifying items from participating retailers.
What if I order an item for delivery?
If you pay for a qualifying product between December 14 and February 15 and it is delivered within the same period, no GST or HST will be charged. The Canada Revenue Agency (CRA) states that items are considered “delivered” once they are handed over to a shipping or courier service.
What about imported items?
GST/HST will not be charged on imported goods that qualify under the same criteria as domestic items.
Are food deliveries included?
When you order a prepared meal for delivery, the food is eligible for the GST/HST relief. However, delivery fees charged by the platform are not eligible for the relief. If the restaurant directly handles the delivery, the delivery service is covered by the relief.
What about mixed drinks?
Mixed drinks that only contain ingredients eligible for the tax relief, such as beer or wine, will qualify. However, cocktails made with spirits like rum or vodka will still have the tax applied.
Do tips qualify for the relief?
A mandatory tip added to your bill in a restaurant will be exempt from GST/HST, but voluntary tips given directly to staff are not covered.
What if I already bought an item before the tax break?
Some retailers, such as Toys "R" Us Canada, are offering to refund the GST/HST paid on purchases made before the relief period began. However, businesses are not required to offer this, and some may choose not to.
A Canada Revenue Agency spokesperson has confirmed that businesses are not obligated to refund or credit the tax.
