Image Credit: Kent Simmonds / CFJC Today

By Dylana Kneeshaw

HOLIDAY TAX EXEMPTION

GST break settles into status quo spending habits at Kamloops shops

Jan 6, 2025 | 6:00 PM

KAMLOOPS — There’s a little more than one month left in a federal tax exemption period for certain items, but small businesses in Kamloops feel it was a lot of buildup for minimal results.

When it was implemented, some business owners were concerned about incurring penalties for errors made while transitioning their pricing systems, but the worries eased as point-of-sale machines adjusted and the final leg of Christmas shopping got underway.

The tax break began on December 14, and runs throughout the rest of January and into mid-February, which are typically slower spending periods. However, after the first few weeks of the exemption period, local business owners say it hasn’t spurred any shopping increase.

There was a brief panic leading up implementation of the two-month GST exemption, but Fox’n Hounds Sahali Liquor Store owner Al Deacon says it’s been smooth sailing since then.

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“For us, it was quite simple. It’s black and white, you know, what is exempt at the liquor store. And it’s black and white, what’s exempt next door at the pub, so it’s a been a non-issue for us,” he reiterates.

The tax break came during a busy time of year for liquor stores, restaurants and retail shops. And Deacon says it doesn’t appear to have inspired more shopping than usual. In fact, he’s found that many customers aren’t even aware of it until they are at the tills.

“We didn’t see an influx in customers coming through the doors to save money. No one has mentioned it. We have signs on the doors. Most people don’t even know that there’s a savings of 5 per cent, but yet here we are giving it — and we’re happy to do so — but it’s been all for naught, really.”

Nearby at Tumbleweed Toys, staff put in extra work during the holiday rush to manually discount qualifying items. And so far, owner Vanessa Gammel says it’s been going off without a hitch.

“We were busy for Christmas and it didn’t seem like it was different than normal for a Christmas season. We did have people who were coming in and returning things that they bought earlier just so that they could save a few dollars in tax after the [exemption] went in,” she notes. “But for the most part, most people coming through didn’t even know it was happening.”

There was concern about potential Canada Revenue Agency (CRA) penalties for accidental errors, but the CRA states online that “businesses who make reasonable efforts to comply with the legislation will not be the focus of our compliance actions.” And midway through the tax break period, Gammel feels it was a stressful lead-up for a status quo sales result.

“I don’t think it’s made any difference to our sales,” says Gammel. “In terms of the stress that it put on small retailers, I don’t think that was great. And I don’t think most of the customers really care or have noticed a big difference.”

This time of year is traditionally when people come out of the fog of holiday spending and tighten their budgets. But local shops are cautiously curious about whether the continued tax break will influence buyer behaviour until it ends on February 15.

“You know, we’re hoping that it’s going to do that. But with the way it’s rolled out so far for the first half, we don’t expect much for the second half,” adds Deacon.