Economic Impacts of Temporary GST/HST Policy Change

Increased purchasing power with reduced cost on groceries, children's items, and holiday essentials Greater affordability of goods promotes spending on non-essentials

Increased consumer spending during the holiday seasonPotential for saving or diverting spending toward other sectors like entertainment or travel

Higher demand for goods like children's clothing, books and holiday items

Stin on supply chains to meet increased production requirements Potential for higher prices due to higher demands

Online retailers benefit from increased holiday spending Adjustments to online pricing systems to reflect tax relief

More competition between brick-and-mortar and online businesses Higher demand for delivery services

Introduces the tax relief policy and ensures implementation by businesses

Reduced tax revenue during the relief period May require adjustments in budget allocation for public services Encourages economic activity to compensate for lost revenue

Boost in foot traffic sales and stores that sell qualifying goods Inventory management will meet increased demand for tax-relieved items

Possible shifts in focus to promote holiday essentials and children's goods Challenges in ensuring clear communication to avoid consumer confusion

Short term loss of $1.6 billion in federal tax revenue

Economic activity from increased spending may offset some revenue lossImpacts future government decisions on taxation and public funding