Ontario government set to match federal 2-month tax ‘holiday’ on some items | Globalnews.ca

Ontario’s finance minister has announced the province will match a holiday tax break announced by the federal government, removing its provincial sales tax on the same items.

Last week, the Trudeau government announced a series of new affordability measures over the holiday period and into the new year, including a two-month “GST holiday” on some items beginning on Dec. 14.

Deputy Prime Minister Chrystia Freeland called on provincial governments to “step up” and drop their own sales taxes for the same period to lower the cost of those items.

On Wednesday, Ontario Finance Minister Peter Bethlenfalvy said that “following extensive discussions” with Ottawa, his government would remove the provincial sales tax on items that aren’t already tax-exempt.

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“The provincial government will match the federal government’s two-month GST holiday by removing PST from items not currently covered by existing provincial rebates, providing nearly $1 billion in additional relief for Ontario families,” Bethlenfalvy said in a statement.

Ontario has not published estimates of how much the federal two-month holiday would cost, nor an exact figure for the cost of matching it.

Freeland has not said if the federal government will offer financial compensation to provinces like Ontario where a harmonized sales tax (HST) means provincial coffers could feel the pinch.

Instead, she spoke about the positive boost that the proposed “tax holiday” would have on consumers and small businesses who are currently struggling with high costs.

As part of the same affordability measures announced by Ottawa, the federal government said those earning up to $150,000 per year would receive a $250 cheque from the treasury.

That announcement came weeks after Ontario said it would send all residents, regardless of income, a cheque worth $200.

Bethlenfalvy previously suggested the Trudeau government borrowed the idea from its provincial partner.

“It doesn’t matter wherever he gets a good idea from, obviously that was our idea,” he told reporters the day the measure was announced.

–With files from Global News’ Craig Lord.

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