Statistics Canada says retail sales dropped by 4.1 per cent in July from the previous month, and mentions the July 1 sales tax increase to eight per cent from seven per cent.
The agency adds, however, that even with the drop, sales were slightly above the same month one year ago.
Opposition Tory Leader Brian Pallister says the NDP has taken money out of families' pockets and businesses are hurting.
Infrastructure Minister Steve Ashton says Palliister is "cherry-picking" statistics, and says other economic indicators such as housing prices are doing well.
Ashton says raising the sales tax was not an easy decision, but a necessary one to fund infrastructure projects and preserve government programs.