Manitobans can expect to pay less at the grocery store starting July 1, as the provincial government moves to eliminate the provincial sales tax (PST) on a wider range of food items. The change, announced Tuesday by Premier Wab Kinew via an Instagram post, aims to provide relief to families facing rising food costs. Currently, Manitoba’s PST applies to prepared foods and drinks sold for immediate consumption, but the upcoming budget will expand the exemption to include items like rotisserie chickens, salads and pre-packaged meals.
The move, which is contingent on the passage of the 2024 provincial budget, represents a significant shift in Manitoba’s tax policy and could potentially make the province the first in Canada to broadly eliminate PST on grocery items. While basic groceries like fruits, vegetables, meat, and dairy are already exempt, this expansion targets the convenience foods many families rely on, particularly those with busy schedules. The long-term implications of this change, including whether it will be a permanent fixture or a temporary measure, remain to be seen.
The announcement comes as many Canadians continue to grapple with elevated grocery prices. According to Statistics Canada, grocery prices rose 3.4% year-over-year in March 2024, contributing to overall inflation. While the federal government has taken steps to address affordability, provincial initiatives like Manitoba’s PST cut offer a more targeted approach to easing the financial burden on households. The change is expected to impact a wide range of consumers, from families with young children to seniors on fixed incomes.
A First in Canada?
Sylvain Charlebois, director of Dalhousie University’s agri-food analytics lab in Nova Scotia, described the move as “bold” and potentially groundbreaking. “Manitoba may very well be the first province to do this,” Charlebois told CBC News. “I think it should be welcome news for the rest of Canada, and perhaps other provinces should follow suit.” He cautioned, however, that the impact on food security would be “very minimal,” given the continued application of the Goods and Services Tax (GST) and other economic factors influencing food prices.
Charlebois also pointed out a potential downside for restaurants, noting that grocery stores’ ready-to-eat counters essentially compete with restaurants without the same overhead costs. “It’s a bit of a disadvantage for restaurants,” he explained. “Grocery stores are becoming more and more like restaurants, but without the tips and the alcohol.”
The Impact on Manitoba Families
For Winnipeg residents like Sanjay Sewpaul, a father of four who spends approximately $1,500 per month on groceries, the announcement is cautiously welcomed. Sewpaul, who recently spent $305 on groceries including $6.58 in PST, acknowledged the potential benefit but expressed skepticism about the magnitude of the savings. “It’ll allow us to get a couple more things, but not too much more,” he said to CBC News while leaving a grocery store. “It’s like next to nothing.” He emphasized the necessitate for broader measures to address the rising cost of living and regulate grocery prices.
Other shoppers shared similar sentiments. Jesse Day noted that any reduction in grocery costs is helpful, adding, “Groceries have become my luxury. Like, I get excited over groceries the way I used to get excited over buying clothes.” Jackie Smith expressed optimism that the change would particularly benefit lower-income families who often rely on pre-made meals. “If you’re a lower income family, you tend to go to the pre-made stuff that you understand is [cheaper],” she said. “I think it’ll definitely help. It is unfortunate that the healthier stuff is so expensive.”
Charlebois also highlighted the growing trend of products being categorized as “snacks” rather than food due to “shrinkflation”—where companies reduce product size without lowering the price—leading to unexpected PST charges at the checkout. The Manitoba government’s bulletin on PST details the specific items subject to the tax, and the removal of PST on prepared foods aims to address this confusion and provide greater transparency for consumers.
Looking Ahead
The implementation of this policy hinges on the successful passage of Manitoba’s 2024 budget, which is currently under consideration. The government has not yet specified whether the PST removal will be a permanent change or a temporary measure, leaving some uncertainty about its long-term impact. Charlebois also noted that broader economic factors, including rising fuel prices linked to geopolitical tensions, are likely to continue influencing food costs in the coming months. He anticipates Canada will likely experience higher inflation in the near future.
The next key date for this initiative is the expected budget vote, after which the details of the implementation will be clarified. Manitobans will be watching closely to observe how this policy unfolds and whether it delivers the promised relief at the grocery store.
What are your thoughts on this change? Share your comments below and let us know how you think this will impact your grocery bill.
