Gas station owners across Canada are preparing for the temporary GST/HST holiday announced by the federal government. This measure aimed at alleviating affordability pressures in a post-COVID economy for Canadians during the holiday season. Starting December 14, 2024, and running until February 15, 2025, the tax holiday break will entirely remove the GST/HST on a wide range of items including snacks, baked goods, prepared foods, alcohol under 7% ABV, children’s clothing and toys, and print newspapers. While the policy is expected to boost consumer spending, many business owners are concerned about the operational challenge it imposes and its short-lived nature.
Gas station owners face the dual challenge of navigating complex tax changes while maintaining operational efficiency during one of the busiest times of the year. The two-month duration of the GST/HST holiday adds to the complexity, requiring businesses to implement and later reverse these changes when the policy concludes in mid-February. Joe Houston, Manitoba business owner, noted that while many of his store’s products qualify for the tax break, not all do, requiring meticulous item-by-item adjustments in their point-of-sale systems. “It’s not just a matter of blanket removing the GST,” Houston said. “This adds a significant amount of work for employees, with limited time to prepare.”
What Items Are Included in the GST Holiday?
The GST/HST holiday applies to a wide range of goods commonly sold at gas stations, including:
- Snacks: Candy floss, chewing gum, chocolate-coated treats, chips, salted nuts, and granola products.
- Frozen Desserts: Popsicles, ice cream, frozen yogurt, and similar treats.
- Baked Goods: Cookies, muffins, pies, doughnuts, and other items with sweetened fillings or coatings.
- Prepared Foods: Sandwiches, salads, and platters of fruits, vegetables, cheese, or cold cuts.
- Other Goods: Children’s diapers and print newspapers.
A full list of qualifying items is available here
2024 Winter Tax Break Steps for Gas Station Owners
To manage the GST/HST holiday efficiently, gas station owners should prioritize the following actions:
- Update POS Systems and Inventory: Ensure tax settings are adjusted to remove GST/HST on qualifying goods by December 14, 2024, and reapply it promptly on February 16, 2025. Failure to make these updates accurately could result in non-compliance. Because the exclusions are item-specific, retailers may need to go through and adjust taxes on items individually.
- Notify Staff: It’s important that your staff understand which items qualify for the tax exemption. This awareness will enable them to confidently answer customer questions and communicate the changes clearly, ensuring a smooth and positive shopping experience.
- Communicate with Customers: Use signage, digital displays, or receipts to inform customers about tax-free items during the holiday. Clear communication will minimize confusion and boost customer confidence in your business.
- Keep Detailed Records: Document all changes to your tax system in case of audit and to ensure compliance with CRA regulations
Post GST Holiday Transition: What Happens After February 15?
When the GST/HST holiday ends, gas station owners must revert their tax systems to standard settings, ensuring GST and HST is collected on all previously exempt items. Proper documentation of these changes will be essential for compliance and mitigating audit risks.
Preparing Your POS for the GST Holiday
At Wiz-Tec, we understand that your POS system is a critical partner in your business, especially during the upcoming GST holiday. These changes can significantly impact operations, particularly for businesses with varied or extensive inventories. To ensure a smooth transition, we recommend contacting your POS provider for detailed instructions on how to best handle these updates or for additional training if needed.
To our valued customers, Wiz-Tec will be sending an email with specific instructions on how to use the Back Office Dashboard to easily update the tax flag for your products. Additionally, we will release a comprehensive guide with practical tips and timelines as the deadline approaches. These resources are designed to help you navigate this transition with confidence and ease.
We are committed to equipping our customers with clear, step-by-step guidance to implement these updates while keeping their operations running smoothly. With careful preparation and execution, this two-month policy can become an opportunity to strengthen customer relationships and enhance your business operations. Take the time now to ensure your systems and teams are ready for December 14—your customers and bottom line will thank you.