ST. PAUL - The federal GST break took effect on Saturday and St. Paul businesses were taking inventory of what needed doing before then.
Announced in November as a means of providing “real relief at the cash register,” the two-month tax break does not apply across the board, but instead only to specific types of items, causing headaches for business owners.
Deb Poulin is the owner of Twisted Fork, a restaurant in St. Paul that also sells jams and sauces online.
Based on the guidelines, most of her online store will be GST-exempt. In the restaurant, beer and wine are exempt, but drinks mixed with hard liquor are not.
According to Poulin, the announcement was a very broad statement.
“We don’t get charged GST on a lot of groceries, so there are some parts where it helps balance things out a little bit, but our shipping company is still charging GST,” said Poulin.
She said it’s also going to be a “pain in the proverbial . . . ” because she’ll have to go through her point-of-sale system item by item on Friday night to update the specific things which will be GST exempt until Feb. 15 - the Saturday of the Family Day long weekend.
Roxanne Suvak is the manager of Greg’s Value Drug Mart. She said not only is there the work of updating the point-of-sale system, but also the new concern around interpreting the guidelines.
Suvak gave colouring books as an example. She has them classified as a children’s toy, which would be exempt. But the guidelines specifically exclude colouring books from the GST break.
“And then tracking what you've done to be sure that if an audit comes, that you've got clear reasoning why you took the GST off of something that was previously taxable,” said Suvak.
Because of the complexity and confusion around what will and won’t be taxable, the Canada Revenue Agency is expected to focus their efforts on people and businesses that are non-compliant and refusing to support the program, rather than those who make a mistake in good faith.
“I think it's fair that there's some effort being made to give some expense relief over the holidays, but this is just a real nightmare way of doing it,” said Yvonne Weinmeier, the executive director of the St. Paul and District Chamber of Commerce.
