Quebec’s partial QST removal begins, prompting mixed reactions

Quebec's partial QST removal begins, prompting mixed reactions

A new tax break took effect Wednesday, removing the Quebec Sales Tax (QST) from a range of food and hygiene products sold in grocery stores.

The measure applies to items including toilet paper, facial tissues, certain snack bars, prepared fruit and vegetable platters, salted and seasoned nuts, as well as some individual baked goods such as muffins, croissants and doughnuts.

The provincial government estimated the change would cost roughly $100 million per year and save the average household about $50 annually.

While shoppers began seeing the savings immediately at checkout, some independent grocers said implementing the change came with headaches.

“It’s bad for the small retailer who don’t have somebody that can do all this,” said grocery store owner John Esposito. “We’re fortunate to have somebody.”

Esposito said the challenge went beyond determining which products qualified and updating systems accordingly. Staff had to review thousands of products individually because of precise eligibility criteria.

“It’s a very big job — it’s like pick and choose, so we have to go through a whole list the government sent us,” added Esposito.

The complexity stems from the highly specific nature of the exemption. For example, salted peanuts are now exempt from QST, while candied peanuts remain taxable. Individual muffins may qualify, while other prepared foods do not.

Government says measure benefits everyone

The policy was announced in May by Quebec’s premier Christine Fréchette, who said one of the goals was to address inconsistencies in how certain grocery products were taxed.

She also argued the measure would particularly benefit those who often purchase smaller quantities.

“People who are living alone, for example, they will benefit from the abolishing of that tax,” she said at a press conference Wednesday. “They will not have to buy six, eight or ten muffins — they can only buy two or three of them and benefit from it.”

Fréchette said the exemption was designed as a permanent measure, unlike the temporary federal GST [Goods and Services Tax] holiday introduced earlier this year.

“We are helping [Quebeckers] to reduce the pressure that is put on their budget,” said the premier.

Critics say impact will be limited

Not everyone was convinced the measure would meaningfully reduce grocery bills.

Sylvain Charlebois, senior director of the Agri-Food Analytics Lab at Dalhousie University, said the average family of four could save roughly $80 to $120 per year. While he said the government’s intention appeared to be protecting consumers from shrinkflation, he argued the exemption remained too narrow to significantly improve affordability.

“The measure could have gone much further to actually make a real difference,” said the food analyst.

Charlebois said the product list appeared to favour certain types of foods while excluding many ready-to-eat options.

“Those taxes will discriminate against people who live alone, seniors as well who are on a fixed income,” he said. “They go to that counter because they don’t want to waste food, because they can’t cook or don’t want to cook.”

• READ MORE: Chips, rotisserie chickens and other foods go provincial sales tax-free in Manitoba

He also questioned why prepared foods such as sandwiches and salads sold at grocery store counters remained taxable.

“People can question why the government is doing that because these are healthy options being taxed,” added Charlebois.

He also contrasted Quebec’s approach with Manitoba’s, where the province eliminated its retail sales tax on grocery food items more broadly.

Back at his store, Esposito argued that grocers should have been part of the decision-making for the list.

“We know what people eat better than the guy sitting in the office,” he said. “We’re the ones on the floor — we see what people buy, what people eat and what people like.”