Liberals’ promise of GST break, $250 cheques in jeopardy as opponents demand costly changes

It’s not clear how the Liberal government is going to salvage its plan to deliver on its promise of a GST holiday and $250 cheques for some Canadians now that some opposition parties are demanding changes that could dramatically increase the cost.

Last week, Prime Minister Justin Trudeau announced a multi-billion dollar affordability package aimed at alleviating cost-of-living pressures. The first element is a proposed GST holiday on some goods and services — including children’s toys, beer and wine and restaurant meals — from Dec. 14 until just after Valentine’s Day. 

Trudeau also announced a plan to send $250 cheques to the 18.7 million people in Canada who worked in 2023 and earned $150,000 or less.

That’s angered some retirees who say they feel abandoned by the government’s latest inflation relief measure.

After first pledging support for the bill, NDP Leader Jagmeet Singh signalled Tuesday that his party would not support it unless the GST holiday measure is separated from the cheques, which the government calls the Working Canadians Rebate.

“If they want New Democrat support, first put the GST holiday separate and let’s get that done right away, so people get that GST holiday right away,” said Singh, who ended his governance agreement with the Liberal government earlier this fall.

“And then fix the cheques to include seniors and people living with disabilities and people that weren’t able to work in 2023.”

Bloc Quebecois Leader Yves-François Blanchet also said this week his party will not support the proposal unless the benefit portion is expanded to include seniors.

Conservative Leader Pierre Poilievre has said he wanted to see the specifics of the bill and would discuss it with his caucus Wednesday.

“Our priority is not to save you 10 cents on a bag of potato chips right before quadrupling the carbon tax on your heat, housing, gas and groceries,” he said on Tuesday.

Without another party’s support, the minority Liberal government won’t have enough votes to pass the bill. 

‘Canadians are depending on this relief:’ Gould

Stopping before the Liberal caucus meeting Wednesday, Liberal House leader Karina Gould would not comment on the plan for the bill before the House, citing parliamentary privilege.

She also did not answer reporters’ questions about whether the government is considering Singh’s demand to deal with the GST break in a separate bill and expand the number of Canadians who would be eligible to receive $250 cheques.

“What I can say is there is very important legislation before the House and I think it’s incumbent upon all members of Parliament to support [it],” Gould said.

“Canadians are depending on this relief over the holidays.”

WATCH | GST holiday: How much are you actually saving? 

GST holiday: How much are you actually saving? | About That

The federal government will implement a two-month GST break on a list of goods, from restaurant meals to diapers. Andrew Chang explains how much you’re likely to save, depending on where you live, and why there could be some unintended consequences.

Liberal MP Ken McDonald, who represents the Newfoundland and Labrador riding of Avalon, said he agrees the bill should be expanded but he’ll still vote for it.

“We’re missing a group that really could use help and that’s those seniors,” he said before caucus on Wednesday.

“The other side of it is, if you vote against it, you’re hurting everybody else that’s supposed to receive it.” 

Scarborough—Guildwood Liberal MP John McKay called the bill a “good faith attempt” and said the government has to draw a line when doling out billions of dollars.

“If you can design the policy, I’m interested in talking to you,” he said.

“Every policy that’s designed by any government is going to be imperfect. That’s the nature of the beast.”

The tax holiday would cost the federal treasury an estimated $1.6 billion in foregone revenue. As is, the $250 cheques will cost about $4.68 billion, a Finance official told CBC News.