Canadian Prime Minister Justin Trudeau is playing Santa Claus with a seasonal tax break amid growing frustrations over the cost of living in Canada.
The Prime Minister announced on Thursday a temporary two-month pause on sales tax on a fixed list of goods during the festive season.
The list includes Christmas trees, restaurant meals, toys, alcohol and candy.
Conservative Leader Pierre Poilievre – who will face the Liberal Prime Minister in an upcoming election – called Trudeau’s tax measures “a ploy” aimed at diverting attention from the government’s role in rising costs.
“For two months, Canadians are going to get a real break from everything they do,” Trudeau said at a news conference.
“Our government can’t fix prices at the cash register, but we can put more money in people’s pockets. That will give people the relief they need. People are under pressure and we are here to help.”
According to Statistics Canada, Canadian inflation peaked at 8.1% in 2022 and has since fallen to 2% in November. But the extra costs for everything from rent to groceries have hit the wallets of many Canadians.
Last spring, a Statistics Canada survey found that 45% of Canadians said rising prices have made it difficult for them to meet their daily expenses.
Trudeau’s limited tax credit, if approved by Parliament, would run from December 15 to February 15. It would remove the federal sales tax known as GST — or the Harmonized Sales Tax (HST) in provinces that combine federal and provincial sales taxes into one tax — from a select list of items.
These items include:
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Food and drinks that are not normally exempt from tax, such as ready-made meals, sweets, alcohol and soft drinks
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Children’s toys for under 14 years
The government estimates the aid will save Canadians C$100-$260 (£56.86-£147.82) if they spend C$2,000 (£1,137.10) during this period.
But those holiday savings will cost the treasury an estimated $1.6 billion, a finance official told CBC News.
Trudeau faces an uphill battle as the October 2025 election looms. A Leger poll in November showed Trudeau trailing his top rival Poilievre by 16 points. And more than two-thirds of Canadians in the same poll said they were dissatisfied with his government.
In September, Canada’s left-wing New Democratic Party (NDP) ended the two-and-a-half-year-old agreement with its Liberal Party that had helped keep its minority government in power.
This step does not mean that elections will be automatically held, but it does make it possible for elections to take place before the planned date, in the autumn of 2025.
Trudeau has already survived two votes of no confidence in parliament since September.
