Canada’s federal government has announced a comprehensive set of initiatives designed to alleviate food inflation pressures affecting households and support businesses across the food supply chain.
In a statement, Prime Minister Mark Carney’s office emphasized that these measures aim to make “groceries and other essentials more affordable for Canadians.” According to recent data, food prices in Canada surged by 6.2% year-on-year in December, marking the highest increase since August 2023.
Dr. Sylvain Charlebois from Dalhousie University remarked, “According to the latest internationally comparable data, Canada now sits at the top of the G7 for food inflation.” In response, the government’s announcement on January 26 includes a mix of direct financial assistance for low-income households, business support, and long-term structural reforms.
Carney highlighted, “We are building a stronger economy that benefits everyone—creating thousands of new career opportunities with better wages.” At the heart of this plan is the Canada Groceries and Essentials Benefit, which enhances the existing Goods and Services Tax (GST) Credit. This inflation-indexed benefit is projected to assist over 12 million Canadians starting this spring, pending Royal Assent.
Over the next six years, the Canadian government will allocate C$11.7 billion ($8.52 billion) in additional support. By 2026, a one-time payment equal to a 50% increase in the GST Credit will also be issued. For instance, a family of four could receive up to C$1,890 this year, along with approximately C$1,400 annually for the subsequent four years. A single individual stands to gain up to C$950 this year, with about C$700 annually for the next four years. Payments will be distributed quarterly at the start of each quarter.
On the business front, Ottawa is dedicating C$500 million from the Strategic Response Fund to help companies manage supply chain disruptions and associated costs without passing those expenses onto consumers. Additionally, a new C$150 million Food Security Fund will be established under the Regional Tariff Response Initiative, aimed at supporting small and medium-sized enterprises and their partner organizations.
To promote domestic production and incentivize investment, the Canadian government plans to introduce immediate expensing for greenhouse buildings. Producers can fully write off greenhouses acquired after November 4, 2025, provided they are usable before 2030. This measure intends to enhance domestic food supply and stimulate investment in production over the medium to long term.
Furthermore, the government is developing a National Food Security Strategy that focuses on bolstering domestic food production while making nutritious food more affordable. Planned measures include unit price labeling and support for the Competition Bureau in monitoring competition within food supply chains.
Canada’s Minister of Agriculture and Agri-Food, Heath MacDonald, stated, “These measures will support Canada’s agriculture sector and strengthen the systems Canadians rely on every day. By taking action now, we’re helping families manage essential costs, improving food affordability, and building a more resilient food system.”
