For immediate release: March 8, 2023
OTTAWA— Canadians for Tax Fairness congratulates Members of Parliament for taking a step in the right direction and questioning grocery executives about food inflation at today’s Standing Committee on Agriculture and Agri-Food (AGRI).
“While long-overdue, we’re encouraged to see the federal government beginning to acknowledge the role that corporate profits have played in driving up food prices,” said Dr. DT Cochrane, Canadians for Tax Fairness’ economist and researcher who has been closely tracking the rise of corporate profits.
“Large grocers have denied profiting from inflation but their markup over costs tells a different story. Take Loblaws, which increased their gross markup from 44.3% in 2019 to an astounding 46.7% in 2022. Had they maintained their 2019 markup, Canadians would have saved almost $900 million,” Dr. Cochrane said.
In his recent address to the AGRI committee, Dr. Cochrane outlined how corporations along the food supply chain have taken advantage of global economic turmoil to increase profit margins at the expense of Canadians.
“The big grocery chains have quite rightly been the poster children of food inflation, but this goes well beyond food retail,” Cochrane said. “That is why it is critical for the federal government to expand its windfall tax on the financial sector to cover all large corporations’ profits across every sector of the economy.”
A windfall tax would reduce corporations’ incentives to increase profit margins at every opportunity. Revenue from the tax could be used to invest in the economy and programs to make life more affordable for Canadians as the country faces a recession.
Canadians for Tax Fairness