GST Holiday Hurts More Than It Helps

The federal government delivering a $1.6 billion tax reduction just in time for the holidays would usually be like a shiny Christmas present under the tree.

Well intentioned or not, this GST holiday feels like anything but a gift. With just two-weeks’ notice given during one of the busiest times of the year, it has only added stress and work to small- and medium-sized enterprises across B.C. Time is money for all of us, but especially for the entrepreneur. The least business owners could ask for is clear rules from the Canada Revenue Agency (CRA) on what products qualify. Did they get that? No, they did not.

It feels like this “gift” is more likely to benefit some of the nearly 60,000 CRA employees who are likely already making plans to audit whether Canadian SMEs could interpret the rules correctly.

The rising costs of doing business, increased regulatory pressures, supply chain disruptions, and the broader economic climate have made 2024 an exceptionally difficult year for businesses. Next year is already shaping up to be incredibly challenging. When the GST holiday ends, businesses are going to wake up in February with Donald Trump implementing America-first policies as President, nearly $2 billion deeper in debt, and with an economy no better off than it was before, thanks to this policy.  

With unemployment on the rise, the threat of tariffs looming large, systemically lagging productivity and business investment, we cannot afford short-term political consumption. Instead of a debt-fueled holiday, we are asking for policies that drive investment, competitiveness, and strengthen our economy’s long-term future.