Canadians will soon have a two-month holiday from the GST, but how much will that really save you on your bills?
Last week, Prime Minister Justin Trudeau announced that the government would cut the GST on a long list of items heading into the costly gift-giving season.
“As the holidays approach, families, especially parents, are particularly worried. Canadians have been through a lot,” Trudeau said during a press conference last week.
“We’ve been able to get through the past couple of years; everyone had to tighten their belts a little bit, and now we’re going to be able to give a tax break for all Canadians.”
Starting December 14, Canadians are getting a tax break.
We’re pausing GST/HST on groceries, kids’ clothes, and other everyday essentials. pic.twitter.com/0pNR6ilVec
— Justin Trudeau (@JustinTrudeau) November 24, 2024
Some of the highlights from the list of products include groceries, beer and wine, restaurant meals (dine-in, take-out or delivery), essential childcare items, and even Christmas trees. You can view the full list here.
The GST cut, which the government estimates will provide $1.6 billion in federal tax relief, will start on December 14 and end on February 15.
How much money could you really save?
Daily Hive decided to calculate how much this pause might save you on food for two months depending on whether you’re single, a couple, or a family of four.
We based the average monthly grocery bill on what the latest Canada’s Food Price Report estimated it would be for 2024. The current GST rate is 5%.
A single person between the ages of 31 and 50 spends approximately between $310 and $350 a month on food.
With the two-month GST break, a single person would see savings of about $31 to $35 on their groceries.
Canada’s Food Price Report 2024 estimates that a couple (man and woman aged 19 to 30) might spend about $730 a month on food. The couple would therefore save about $73 during the two-month GST holiday.
Lastly, an average family of four spends approximately $1,358 a month on food. The GST cut would save them about $135 over the two-month period.
Provinces where the HST will also be removed on qualifying goods will see even more savings. In Ontario, for example, a family spending $2,000 on groceries in two months will see savings of $260, according to the government’s example.
This announcement came a week after the NDP vowed to eliminate the GST from everyday costs like heating, cell phone bills, internet, groceries and children’s needs. The Liberal government’s tax break does not apply to monthly bills.
NDP Leader Jagmeet Singh issued a statement saying the Liberal government’s decision to pause the GST is in response to their demands.
“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,” said Singh.
He added that the policy is “far from the substantial and permanent relief” the party is pushing for.
Conservative Party Leader Pierre Poilievre also responded to Trudeau’s GST holiday, calling it a “two-month, temporary tax trick.”
And, of course, Canadians sounded off online with mixed feelings towards the tax break.
What do you think about how much you’ll save in those two months? Let us know in the comments.