Food inflation in Canada rises as tax holiday ends and key groceries jump

Statistics Canada reported food inflation rose 7.3% year‑over‑year in January, with the end of a temporary restaurant tax break and large price increases for beef and coffee cited as main drivers.

Statistics Canada reported that annual food inflation in Canada was 7.3% in January. That rate is the highest in the G7 and more than double the pace from six months earlier. A major statistical contributor was the end of a temporary restaurant and prepared‑food tax break that ran from mid‑December 2024 to mid‑February 2025. Several grocery items also showed notable price increases for supply and production reasons. Reported drivers: - Annual food inflation was reported at 7.3% in January. - The end of the temporary restaurant and prepared‑food tax holiday is a large statistical contributor; prices had been lower a year earlier while the break was in effect. - Reported price jumps include beef rising 18.8% and coffee rising 29.8% year‑over‑year in January. - Other items mentioned include lettuce up 6.7% and soup up 6.3%, while mushroom prices rose by less than 1%. Summary: Statistics Canada presented the January figure as reflecting both the expiration of the temporary tax break and sharp increases for some widely purchased items such as beef and coffee. The result is higher measured food inflation and continued upward pressure on consumer food costs. Undetermined at this time.