This holiday season, Canadians are being more cautious about their spending despite a tax break on a slew of items, new polling shows.
Nearly 40 per cent of Canadians said in an Ipsos poll conducted exclusively for Global News and released Tuesday that they plan on reining in their gift shopping this holiday season. That is an increase of 10 points compared to when similar polling was done last year.
Four in 10 also plan to spend the same amount as last year — down nine points compared to October 2023 — while 11 per cent said they will increase their spending on gifts this time around, the Ipsos poll showed.
“At the moment, it looks like people are approaching the holidays pretty cautiously and to the extent that people are moving past caution, it’s not to spend more, it’s to spend less,” said Darrell Bricker, global CEO of Ipsos public affairs.
Financial pressures are weighing on the majority of Canadians’ holiday spending budget, with 76 per cent saying that inflation and interest rates have had a “significant impact.”
Overall inflation has cooled in recent months, hitting Bank of Canada’s two per cent target in October, and interest rate is down to 3.25 per cent after five consecutive cuts. Yet, many Canadians are still continuing to feel a squeeze in their wallets.
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To help ease the pressure for Canadians on the cost of living, the federal government has enacted a two-month “tax holiday” on several items that kicked in on Saturday. Bricker said even the tax break does not appear to have had the “desired effect” that Ottawa was going for.
“(Canadians are) budgeting more than they used to be, more conscious about the money that they’re spending and they don’t think that even a tax holiday is anything that’s going to turn this around,” he said.
Younger Canadians, aged 35 to 54 years, are cutting back on their holiday spending the most, the Ipsos poll found.
“What younger Canadians are telling us that they’re not making the progress in their lives that they thought that they should be making and they can’t even participate in holiday traditions to the degree that they would like to, which is … somewhat depressing to hear that this time of the year,” Bricker said.
What are Canadians concerned about this holiday season?
Almost 60 per cent of Canadians surveyed by Ipsos said they can’t spare extra money on gifts this holiday season because they have to spend more on basic necessities.
Nearly half (47 per cent) said they are budgeting their finances more carefully and 30 per cent said they make less money now than in past years.
Credit card debt is also top of mind for many Canadians this holiday season, with 43 per cent concerned they won’t be able to pay off their credit card debt and more than a third (36 per cent) worried about needing a new credit card, line of credit or loan to afford holiday shopping.
The Ipsos survey showed that 45 per cent are concerned that they might not be able to afford holiday gifts for their family or loved ones and 41 per cent are anxious “they will get in over their heads with holiday spending.”
With grocery prices still running high and expected to stay that way into the holiday season, four in 10 (39 per cent) Canadians fear they won’t be able to put food on their tables, polling found.
“The ironic part of this is the government really put a lot into not just financially, but in terms of the reputation into people on getting some relief and they’re just not feeling it,” Bricker said.
These are some of the findings of an Ipsos poll conducted between Dec. 6 and 10, 2024, on behalf of Global News. For this survey, a sample of 1,001 Canadians aged 18+ was interviewed online. Quotas and weighting were employed to ensure that the sample’s composition reflects that of the Canadian population according to census parameters. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ± 3.8 percentage points, 19 times out of 20, had all Canadians aged 18+ been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.
© 2024 Global News, a division of Corus Entertainment Inc.