The Canadian government, led by Prime Minister Justin Trudeau, has announced plans to temporarily remove the federal sales tax on certain items and distribute cheques to millions of Canadians. This initiative aims to address the rising cost of living and comes as a federal election approaches, which could occur anytime between this autumn and next October.

Trudeau stated at a press conference in Toronto, “Our government can’t set prices at the checkout, but we can put more money in people’s pockets.” The plan includes a one-time cheque of 250 Canadian dollars for those who worked in 2023 and earned up to 150,000 Canadian dollars (USD 107,440). This measure is expected to benefit approximately 18.7 million Canadians.

Federal Sales Tax Relief

The temporary federal goods and services tax relief will be effective from December 14 to February 15. This tax break will cover various items such as children’s clothing and shoes, toys, diapers, restaurant meals, beer, wine, Christmas trees, snack foods, beverages, and video game consoles. These measures aim to ease financial burdens during the holiday season.

Trudeau has committed to leading his Liberal Party into the upcoming election. Historically, no Canadian prime minister has secured four consecutive terms in over a century. The Liberals currently depend on support from at least one major party in Parliament due to their lack of an outright majority.

Political Landscape

In 2015, Trudeau revitalised Canada’s liberal identity after nearly a decade of Conservative governance by drawing on the charisma of his father. However, he now faces challenges as Canadians express dissatisfaction with the cost of living post-COVID-19 pandemic. The latest Nanos poll indicates that the Liberals trail behind the opposition Conservatives with 26 per cent compared to 39 per cent support.

The poll surveyed 1,047 individuals and has a margin of error of plus or minus 3.1 percentage points. Trudeau’s leadership is under scrutiny as he navigates these economic challenges while preparing for an impending election.

This initiative reflects the government’s effort to alleviate financial pressures on Canadians during uncertain times. By providing direct financial support and temporary tax relief, Trudeau aims to address voter concerns about affordability and economic stability.