A tax break and cut cheques: Ottawa announces relief plan for cash-strapped Canadians

In an effort to assist Canadians facing financial strain, Prime Minister Justin Trudeau announced a temporary tax break aimed at reducing the cost of everyday essentials. The relief, which will last for two months, includes a suspension of the GST on items such as groceries, children's clothing, diapers, restaurant meals, and various consumer goods like toys, video games, and Christmas trees.

"This is a chance to give all Canadians a bit of relief after everyone had to tighten their belts," Trudeau explained.

Starting mid-December, the federal government will remove the GST, and in some areas, the HST, from these goods. However, the break will only last until mid-February.

"It's a small percentage," noted Colin Norman. "If you're making a larger purchase, it could make a difference."

Davis Dowler acknowledged the short-term help but expressed concern about the long-term need for the GST. "Helpful for a couple of months, but in the long run, I think we still need the GST," he said.

Dina Ottoni-Battistessa, however, felt the timing was less ideal, saying, "It should start December 1st, not the 15th, when most of our Christmas shopping is already done."

For some businesses, the timing of the break aligns well with typically slower months, like January and February. Anna Palmer from Ollia Macarons and Tea said, "We'll gain a little bit, but two months is just a pinch in a big pot of salt." She also emphasized the need for broader measures to address rising living costs, like raising the minimum wage, which is among the lowest in Canada.

Others, including Vibrant Communities Calgary, called for deeper policy changes at the federal level, suggesting that temporary relief wouldn't provide lasting benefits. "Unless we change policies at the federal level to address root problems, these measures won't help much in the long term," the organization stated.

In addition to the tax break, 18.7 million Canadians who earned $150,000 or less last year will receive a $250 rebate check. The government estimates the total cost of the GST holiday at $1.6 billion, which will require new legislation.

The NDP supports the measure but is focused on ensuring the bill is passed quickly. "We want to see this relief done as quickly as possible," said NDP Leader Jagmeet Singh.

The Conservative Party, on the other hand, has been critical, with leader Pierre Poilievre calling it "a two-month temporary tax trick."

With cost of living remaining a top concern for voters, the measure may provide some political benefits for the Liberals, but the temporary nature of the break may increase pressure to continue it. A federal election is set for the fall, although there is speculation it may be called sooner in the spring.