For a campaign platform chock full of gimmicks, Erin O’Toole spent the day touting one of them – a proposed “GST Holiday” in the month of December, ostensibly as a way to stimulate economic activity. It’s a hugely expensive proposition, but also a hideously complicated one – by promising to make this come off at the till rather than as a rebate from CRA, he is loading all kinds of complication onto businesses, who may not be able to easily disentangle the federal GST from provincial sales taxes, particularly if they are harmonized in an HST as they are in most provinces. (It also won’t make those purchases “tax free” as O’Toole says in his video, unless you’re in Alberta). And even the Canadian Federation of Independent Business thinks this is a dumb idea that is more complicated than it’s worth.
Purchases won’t be tax-free except in Alberta, as there will still be provincial tax (and this will mess with POS systems in those retailers).
As for your plan to “lower prices” for Canadians, are you saying that you want the Bank of Canada to target deflation? https://t.co/ZJFMDx1tfp— Dale Smith (@journo_dale) August 17, 2021
.@CFIB comments on the Tories “GST holiday” plan in the new platform: “Some of the other promises, like a month long GST holiday or credits for vacations or restaurant meals on certain days seem a bit gimmicky and will likely be too complicated to be of much value.” #cdnpoli
— Laura Stone (@l_stone) August 17, 2021
We also should call out the fact that this is not only a gimmick, but O’Toole keeps trying to message around the cost of living and food prices, which a GST holiday would do nothing about because the vast majority of food items are GST exempt. O’Toole keeps trying to make inflation an election issue, never mind that it’s the domain of the Bank of Canada and not the federal government, and if he thinks the Bank’s mandate should be changed to target deflation instead of slow and steady 2 percent inflation growth, he needs to come out and say so rather than this posturing about rising prices. Prices are supposed to rise – inflation is not a bad thing when it’s low and predictable, because that helps the economy to grow. But this is populist noise, and for the so-called “party of the economy” to mislead people about this is telling.
https://twitter.com/LindsayTedds/status/1427636793420169217
https://twitter.com/LindsayTedds/status/1427637831002886155