Few Small Businesses Expect Benefits from Proposed GST/HST Holiday, CFIB

By MorinvilleNews.com Staff

A temporary GST/HST holiday is receiving little support from small businesses, according to a Canadian Federation of Independent Business (CFIB) survey. Of the 3,500 small firms surveyed on November 26-27, only 4% expect stronger sales due to the proposed two-month tax exemption.

CFIB President Dan Kelly noted that 62% of businesses required to implement the holiday tax break oppose it, with many anticipating challenges and costs. Firms predict the change will simply shift sales into the tax holiday period rather than boosting overall revenue. Additional concerns include the high costs of reprogramming point-of-sale systems, insufficient time to prepare, and fears that large retailers and online platforms will gain a disproportionate advantage. Retailers also foresee delayed purchases and product returns to take advantage of the tax holiday.

The holiday’s effects extend beyond retailers, impacting manufacturers and distributors who may not be fully aware of the changes required. CFIB is calling for a $1,000 credit in GST/HST accounts to offset administrative and programming costs and is urging leniency for good-faith errors made during implementation.

Kelly criticized the timing of the legislation, introduced during the busiest retail week of the year, and called for a focus on permanent tax reforms instead of temporary measures. He highlighted the upcoming carbon tax increase as a priority for cancellation, urging the government to reconsider its approach to supporting small businesses.