Montreal businesses say GST holiday fell short

Some small businesses in Montreal say the GST holiday wasn't worth their time.

The federal GST holiday, designed to ease expenses for Canadians, comes to an end on Saturday. While the initiative aimed to put more money back into consumers’ pockets, reactions are mixed on whether it truly delivered.

For Claire Himo, owner of Sparkles, a candy shop on Monkland Ave., the tax holiday fell short.

“I don’t think it was worth our time as a small business,” she said.

The temporary tax break, which began on Dec. 14, didn’t apply to all items — causing confusion for shoppers and extra work for business owners, added Himo.

“In one department alone, some items were taxable, while others weren’t,” Himo explained, gesturing to a cake pan and decorative edible sprinkles as an example. “This meant spending hours upon hours filtering through thousands of items in the store.”

For her, the hassle outweighed any benefits.

She’s not alone, according to a survey by the Canadian Federation of Independent Business (CFIB). The new data shows that only five per cent of small businesses saw a boost in sales, while 70 per cent reported no real change.

The tax break was even less effective in Quebec, according to Martin Vézina, vice-president of public and governmental affairs for the Quebec Restaurant Association.

“Restaurateurs from Ontario and Atlantic Canada said they have seen an increase in traffic,” said Vézina. “But it’s very neutral here.”

That’s because territories and provinces outside of Quebec also paused their harmonized sales tax (HST), offering more savings, adding up to between 13 and 15 per cent in savings.

Still, restaurants seemed to fare better than other industries, added Vézina.

“We conducted a survey with our members and 72 per cent said they haven’t seen any positive effect, but they also haven’t seen negative ones,” he concluded.

Vézina believes the initiative was a good test run for potential future measures—especially in times of economic downturn, like what restaurants experienced during the pandemic.

Whether consumers and businesses benefited from the tax break or not, one thing is certain: come Sunday, bills will be back to full price.