Update
This story was updated Feb. 18, 2025, with information from ATB Financial.
St. Albert residents say the federal government’s recent GST holiday made little difference to their pocketbooks.
The price of books, beer, and many other items notched up five per cent last Saturday as the federal government’s two-month GST break came to an end. The $1.6 billion tax break removed the GST on a long list of items (including children’s clothes and alcoholic beverages) from Dec. 14, 2024, to Feb. 15, 2025.
The Trudeau government pitched the break as a way to address the high cost of living during the holiday season. The break was projected to save families $100 if they spent $2,000 on affected goods.
The break came with a heaping dose of skepticism from many Canadians. One Postmedia/Leger poll found that just 32 per cent of Canadians thought the break would be helpful, with 70 per cent saying it was a ploy to get votes.
Thumbs down from St. Albert
The GST break did have a small effect on inflation nation-wide, a Feb. 18 analysis by ATB Financial economist Mark Parsons found. Year-over-year prices for restaurants were down a record 5.1 per cent in January, with toys and games prices down 6.8 and alcohol down 3.6. Those prices would likely bump back up in the next two months now that the GST break was over.
Residents and businessowners reached by the Gazette this week said they saw few benefits from the break.
In an email, Forest Lawn resident Jonathon Gratz said the tax break was “a bit of a letdown” for his three-person, two-pet household, as it started after they had already done most of their Christmas shopping and dining. He estimated that they saved about $30.
“I feel the GST holiday only really helped out those who are more on the wealthy side,” he said, as they could afford to buy more of the tax-exempt goods.
Lynn Mathe, a retired resident of Grandin, said in an email that the tax break was “a joke” that did nothing to help with her household’s monthly expenses, as they did not eat prepared meals, rarely ate out or drank alcohol, and did not buy a Christmas tree (all activities covered by the break).
“What we need is a break on our everyday groceries if the government wants us to remain healthy and vibrant,” she said.
Angela Chatwin of the Bookstore on Perron said she was relieved to see the end of the tax break. The break applied to roughly half of her store’s products and had to be applied manually due to limitations in her store’s payment software. Staff often had to check the long list of exemptions to see if they had to apply the break to any one item.
“I think it was a big pain,” she said, adding that she had exactly one customer ask about it while it was in effect.
“I don’t think it affected sales at all.”
Just Kids owner Almut Englberger said she saw a slight upswing in sales during the break but couldn’t say if the break was behind it — it could have been due to the high price of new clothes driving customers to her store, which specializes in less-costly second-hand clothes. Many of her customers hadn’t heard of the break and were happy to learn they didn’t have to pay the tax.
Crown and Tower Pub owner Troy Marchak said he had to call in a specialist to reprogram his cash register to implement the tax break, which applied to food and drinks they sold with less than seven per cent alcohol content. The break might have saved people a bit of money, “but they certainly didn’t go and spend more.”
Gratz said some kind of direct payment like the GST credit many Canadians get each quarter would be a more effective way of addressing the cost of living.
The Trudeau government announced a $250 Working Canadians Rebate last November alongside the two-month GST break, but it has yet to table legislation to implement it as of this month.
