In an effort to make holiday shopping cheaper for Canadians, the federal government has created an “administrative nightmare” for small business staff. That’s according to Brianna Solberg with the Canadian Federation of Independant Business. She says between December 14th and February 15th, there will be no GST on specific items, including children’s toys and clothes, books, video games, and Christmas trees. She states this means staff will have to go through their inventory and make judgment calls on what items should be taxed, based on very vague guidelines from the CRA. “This temporary tax change has created brand new tax categories that never existed before. There’s differential sales tax rates on toys that are marketed for adults versus those marketed for children, or drinks based on their percentage of alcohol, so you can see how it’s extremely confusing for business owners.”
She adds that the changes will mean business owners will either have to spend hours coming through their inventory or spend thousands of dollars on a software to do it for them. “it’s either extremely costly in terms of dollars or in terms of time,” Solberg suggests.
The CFIB is reminding customers to be patient with staff as they learn to adapt to these changes, which they were only given two weeks’ notice about. “Avoid asking for price adjustments or to remove the sales tax from goods purchased before the holiday and avoid returning and repurchasing items to get out of the tax, because this could require retailers to pay with credit card fees on these multiple times.” Consumers are also asked to avoid arguing with clerks and expecting them to be tax experts. Any complaints customers have should be taken up with members of parliament instead of small business owners.
CFIB is asking the CRA to be forgiving if small businesses apply the tax incorrectly and avoid issuing penalties and interest. Solberg also urges the federal government to give affected business a minimum of $1000 in their GST to help cover the administrative costs placed on business owners to implement these changes.
