Temporary GST/HST Relief and The Working Canadians Rebate

November 22, 2024

On November 21, 2024, the federal government announced a temporary two-month Goods and Services Tax/Harmonized Sales Tax (GST/HST) relief on groceries and “holiday essentials” to provide financial support to all Canadians, along with the Working Canadians Rebate—a one-time, tax-free $250 payment for eligible individuals who worked in 2023 and have a net income of up to $150,000.

GST/HST Relief

From December 14, 2024, to February 15, 2025, qualifying goods such as groceries, restaurant meals, drinks, snacks, children’s clothing, shoes and toys will be GST/HST-free.

Key Benefits

Federal Savings: The tax break is estimated to provide $1.6 billion over the two-month period.
Household Savings: A family spending $2,000 on qualifying goods could save:
- Up to $100 in GST across Canada.
- Up to $260 in HST in Ontario.
- Up to $300 in HST in participating provinces (Newfoundland and Labrador, Nova Scotia, New Brunswick, and Prince Edward Island).

Implementation

Businesses are expected to remove the GST/HST at checkout on eligible goods purchased and/or delivered during the relief period. Qualifying goods imported into Canada would also be relieved from the GST/HST application.

Qualifying goods:

Below is a summarized list of items that would be eligible for the proposed tax break:

Children’s clothing, footwear, diapers, car seats
Christmas trees or similar decorative trees (natural or artificial)
Food or beverages:
Soft drinks, wine, beer, ciders, and spirit coolers (up to 7 per cent ABV)
Candies, gum, chocolate, and related sweets
Chips, crisps, puffs, popcorn, brittle pretzels, and salted nuts or seeds
Granola products, fruit bars, and snack mixtures
Ice cream, ice lollies, frozen yogurt, and other frozen treats
Cakes, muffins, pies, pastries, tarts, cookies, doughnuts, brownies, croissants with sweetened filling or coating
Pudding and any other products similar to pudding
Prepared salads, sandwiches, platters of cheese, cold cuts, fruit or vegetables, and other arrangements of prepared food
Dine-in, takeout, or delivery restaurant meals
Doll houses, toy cars, Lego, and action figures
Jigsaw puzzles, board game, card game
Video-game consoles, controllers, cartridge and disc
Print newspapers and selected types of printed books

The Working Canadians Rebate

The Canadian government also plans to introduce legislation to provide a tax-free $250 Working Canadians Rebate to 18.7 million eligible Canadians in early spring 2025. This rebate aims to help Canadians with their expenses and savings and who meet all of the following eligibility criteria:

Worked in 2023 with a net income up to $150,000.
Filed a 2023 tax return by December 31, 2024, and either:
- Claimed tax credits for CPP/QPP or EI/QPIP contributions, or
- Reported income from EI/QPIP benefits.
Resident of Canada on March 31, 2025.
Not incarcerated for 90 days prior to April 1, 2025.
Not deceased on April 1, 2025.

The Canada Revenue Agency (CRA) will automatically distribute the rebate via direct deposit or cheque.

Both measures are still pending parliamentary approval for their official implementation.