OTTAWA — The Liberal government is planning to give Canadians a tax break over the holidays and hand out billions of dollars in a move that two opposition leaders characterized as a trick to buy votes from frustrated people struggling with the high cost of living.
Prime Minister Justin Trudeau made the announcement on Thursday, proposing to cut the federal goods and services tax on a slew of items over a two-month period.
“Our government can’t set prices at the checkout, but we can put more money in people’s pockets,” Trudeau said at a press conference in Toronto alongside Finance Minister Chrystia Freeland.
“The working Canadians rebate of $250 which will be sent to people in April, is going to give people that relief they need, and the tax break over the next two months is going to help on the costs of everything as we approach the holidays, as we get into the new year.”
The proposed GST break would begin Dec. 14 and end Feb. 15. The Liberals say it will apply to a number of items including children’s clothing and shoes, toys, diapers, restaurant meals and beer and wine.
It also applies to Christmas trees — both natural and artificial — along with a variety of snack foods and beverages, and video game consoles.
Canadians who worked in 2023 and earned less than $150,000 would also receive a $250 cheque in the spring.
That means the money would go to about 18.7 million people, costing the government about $4.7 billion. The GST break is expected to cost another $1.6 billion.
The measures come as an inflation-driven affordability crunch has left voters unhappy with the Trudeau government. A federal election is slated to take place before next October, but could come sooner if the minority government falls before then.
The Conservatives have maintained a double-digit lead over the Liberals in public opinion polls for months, as Leader Pierre Poilievre promises to slash taxes and government spending to restore affordability.
High inflation has also put pressure on the Liberals to avoid introducing measures that would stimulate spending and fuel price growth.
However, the prime minister dismissed the idea that this move could raise inflation again, noting that price growth and interest rates are down.
“It allows us to make sure that we are putting money in people’s pockets in a way that is not going to stimulate inflation, but is going to help them make ends meet and continue our economic growth,” Trudeau said.
Poilievre blasted the NDP and Liberals alike over the announcement, saying his party had a better idea: ending the carbon price permanently.