The GST/HST Break is now in effect, offering Canadians temporary relief on some everyday goods and services during the holiday season. The measure, introduced under The Tax Break for All Canadians Act (Bill C-78), officially launched on December 14 and will run until February 15, 2025.
The relief applies to in-person and online purchases, so Canadians will see savings whether shopping at their local store or buying gifts online. Under this temporary measure, grocery items like sandwiches, salads, energy bars, non-alcoholic beverages like coffee, tea, juice, and even certain alcoholic beverages like beer, wine, and cider will be exempt from GST/HST.
However, alcoholic spirits like vodka, whiskey, and rum are not covered by the tax relief. Prepared meals from restaurants, food trucks, or takeout services will also benefit from the relief during the eligible period.
Children’s clothing, footwear, car seats, diapers, toys, jigsaw puzzles, and video game consoles all qualify. However, adult clothing will still be subject to GST/HST, no matter who it's purchased for. There are specific guidelines for children’s clothing, such as the requirement that footwear for children under a particular size and clothing in sizes XS to L are eligible.
Books and printed newspapers will also be exempt from GST/HST. It's important to note that e-books and audiobooks are excluded from the tax relief—only physical, printed books and newspapers are covered. Holiday decorations are also eligible for the break, with items like Christmas trees—both real and artificial—exempt from the tax. However, wreaths, mistletoe, and poinsettia plants remain subject to GST/HST.
The tax relief extends to imported goods that meet the qualifying conditions for online shoppers. As long as these items—such as qualifying food, beverages, children’s products, and books—are paid for and delivered between December 14 and February 15, 2025, they are eligible for the break.
Consumers don’t need extra steps to receive tax relief. Most retailers will automatically apply the GST/HST exemption at checkout. However, if you are mistakenly charged the tax on a qualifying item, you can request a refund from the retailer. Be sure to keep your receipts for any follow-up.
Businesses that typically charge GST/HST on qualifying goods and services will need to make adjustments during this period. Restaurants, retailers, and other service providers must ensure that qualifying items like food, beverages, and children's products are not taxed. However, businesses must still report and remit the regular GST/HST on non-qualifying items.
The Canada Revenue Agency (CRA) has emphasized that businesses making a reasonable effort to comply with the new rules won’t face penalties. However, those found intentionally flouting the guidelines may be subject to enforcement.
One important distinction for consumers is that while prepared meals from restaurants and food trucks qualify for tax relief, the delivery service does not. In cases where meals are delivered through a third-party platform such as Uber Eats or DoorDash, only the meal qualifies for the GST/HST break—the delivery service remains taxed.
Gift baskets containing food or beverages only qualify for tax relief if at least 90 per cent of the total value comprises qualifying items. For example, a gift basket containing chocolates, fruit, and wine would qualify, but one with a significant portion of non-food items, such as toys or beauty products, would not.
There are a few exclusions to keep in mind. These include dietary supplements, cannabis-infused food and beverages, vending machine items, and adult clothing. Additionally, some products like energy or protein drinks will only qualify if they meet specific criteria, such as being marketed as food or beverages to satisfy hunger or thirst.
Consumers should keep their receipts and contact retailers if they encounter any issues with incorrect charges.
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