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Canada Plans to Comp Citizens For Inflated Grocery Costs

Written by RetailWire Staff

Photo: iStock / Khanchit Khirisutchalual

Inflation may be slowing globally, but customers are still getting hit hard by high prices on the grocery shelves. Canada plans to build relief for consumers into its 2023 budget in the form of a one-time payment to low- and middle-income Canadians. Canada’s Budget 2023 proposes a payment of up to $467 for couples with children, up to $234 for single Canadians with no children and an average of $225 for seniors, delivered through the country’s Goods and Services Tax Credit (GST Credit) system. The inflation relief would total $2.5 billion and be paid out immediately after the passage of the legislation. Inflated grocery prices have become a hot-button issue in Canada. A recent survey by the Toronto Star found that a growing number of Canadians—around 30 percent at present—believe that grocers are price gouging.  The survey, by Agri-Food Analytics Lab at Dalhousie University, came after an inquiry by the Canadian parliament into the pricing practices of major grocers during the recent inflationary period. The heads of major grocery chains, who spoke at the hearing,  failed to convince three-quarters of Canadians that they were being transparent about pricing practices.  Recent studies have shown inflation in the U.S. slowing but remaining high, as seen in a March report from Trading Economics. The study found that the rate of grocery price inflation in February dropped from 10.1 percent but grew at an annual rate of 9.5 percent.  Callie Cox, U.S. investment analyst at eToro, pointed to demand, rather than supply chain disruptions or goods prices, as the current leading cause of inflation in a Business Insider article last month. Measures to relieve inflation-strapped grocery shoppers in the U.S. have thus far not been as direct as the Canadian government is proposing. Thirteen U.S. states last year paused the collection of grocery taxes as prices rose, although tax experts questioned the efficacy of these measures.

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