Prime Minister Justin Trudeau speaks in the House of Commons, in Ottawa, on Nov. 26.Adrian Wyld/The Canadian Press
A majority of MPs in the House of Commons have passed legislation that would give Canadians a two-month break from having to pay federal sales tax on a wide range of goods.
The vote on Bill C-78, dubbed the Tax Break for All Canadians Act, passed late Thursday night. The Liberals were supported by the NDP.
The Conservatives and Bloc Québécois, who dismissed the policy as a gimmick, voted against the measure.
The tax break will take place between Dec. 14 and Feb. 15 and is expected to cost $1.6-billion. Items eligible for the tax relief include Christmas trees, kids’ diapers, clothing and toys, junk food, beer, wine, and store-bought, catered and restaurant meals.
In provinces where the sales tax is harmonized, the full tax will be lifted, whereas those that collect federal and provincial sales tax separately will only have Ottawa’s portion of the tax removed.
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The legislation to enact the tax break was the first bill passed through the House of Commons since late September, and required some procedural wrangling from the Liberals and the NDP to curtail the usual debate.
For more than two months, government business in the House has been on pause as the Conservatives filibuster a privilege motion related to misspending at a now-defunct green technology fund.
That debate, which has taken precedence over nearly all other House business, was paused in order to proceed with voting on the GST bill on Thursday.
The minority government got the bill passed so quickly because the NDP also agreed to support a motion from Government House Leader Karina Gould that allowed the bill to be fast-tracked. It skipped the usual practice of a review by a standing committee – including witness scrutiny – and was instead only briefly debated on the floor of the House of Commons.
Conservative Leader Pierre Poilievre told reporters before the vote Thursday that while he’s in favour of tax cuts, he doesn’t believe the two-month tax break counts as one.
“This isn’t a tax cut. This is an inflationary, two-month temporary tax trick that will drive up the cost of living,” he said.
He said his party would instead advocate for its permanent proposals to cancel the consumer carbon price and remove the federal sales tax on new homes.
The Liberals said the Conservative no-vote shows the party is being disingenuous with voters.
“Pierre Poilievre’s Conservatives are hypocrites – they like to say that Canadians deserve a break and help with the cost of living, but then vote down any real support that is offered,” said Finance Minister Chrystia Freeland’s spokesperson Katherine Cuplinskas in a statement.
Green Party Leader Elizabeth May said the measure is “transparently a vote-buying scheme,” but said she was struggling with how to vote because so many Canadians need help.
“It’s not good policy. Whether it’s good politics, we’ll see,” she said during the debate.
Ms. May, who was the only party leader in the House of Commons during the late-night debate, voted in favour of the bill.
The Bloc’s finance critic, Gabriel Ste-Marie, told the House on Wednesday that while his party supports the permanent removal of sales tax from items such as kids’ diapers, it has “serious reservations” about eliminating the levy “on champagne and fancy restaurants, where only the rich can afford to go.”
Mr. Ste-Marie also cited concerns raised by small business owners about the logistical headaches of twice changing their payment processing systems in a short time period to comply with the changes.
The Liberals were initially planning to pass the sales tax break at the same time as a plan to send $250 cheques to working Canadians making less than $150,000 annually. However, no opposition party supported the cheque plan as presented.
The Bloc said it would support the cheques if they were also sent to retirees; the NDP said in addition to retirees, it also wanted the cheques to go to students and people living on disability supports. Those changes would dramatically increase the costs of the Liberal plan, which were estimated at $4.68-billion.
With reports from Bill Curry and The Canadian Press.