On July 5, 2023, the federal government started rolling out a one-time grocery rebate. Intended to help Canadians cope with several years of crushing inflation rates and even higher grocery prices, Canada’s federal budget grocery rebate may be little more than a temporary boost to a growing food cost issue.
Federal government grocery rebate: what is it?
In its 2023 budget, the government announced it would provide a one-time payment to eligible Canadians to help offset the rising cost of food. Those deemed eligible for the federal grocery rebate should have received the payment on July 5 as a boost to their goods and services tax/harmonized sales tax (GST/HST) credit.
The total amount you would have received of the one-time grocery benefit is based on your income from when you did your 2021 income tax and the amount of children you have.
Single adults could get up to:
- $234 (no children)
- $387 (one child)
- $467 (two children)
- $548 (three children)
- $628 (four children)
If you’re married or have a common-law partner, you could get a maximum payment of:
- $306 (no children)
- $387 (one child)
- $467 (two children)
- $548 (three children)
- $628 (four children)
Who qualifies for the grocery rebate?
In its budget, the federal government estimated that approximately 11 million Canadians (mainly low- and modest income families) would receive the rebate. The amount should be equivalent to double the GST/HST payment you received in January 2023.
Eligibility for Canada’s grocery rebate payment is based on two key items:
- Your family/marital status (if you’re married or single and how many children you have)
- Your adjusted family net income as reported on your 2021 income tax form
In order to qualify, you must have a household income of $38,000 or less, or an individual income of $32,000 or less.
And because the new grocery rebate is based on your 2021 taxes and your July 5, 2023 GST/HST payment is based on your 2022 tax return, it’s possible that you got the grocery rebate, but not the GST/HST credit, or vice versa.
How to apply for Canada’s grocery rebate
Fortunately, there’s no need to apply for Canada’s grocery rebate. Eligible recipients should have received the payment automatically via direct deposit from the Canada Revenue Agency (CRA) as a supplement to their GST/HST credit. However, to receive the payment, you must have submitted your 2021 tax return, even if you had no income. It doesn’t matter which tax software you used to file, either — be it the CRA’s NETFILE program or something like Wealthsimple Tax (formerly SimpleTax).
The CRA has recently warned on its website about grocery rebate scams that have been cropping up. One of the most prominent ones is for a person to be sent a link via text message from someone posing as the CRA saying that you must click on the link to get your rebate. Don’t click on this link; you don’t have to do anything to receive the rebate. It will be automatically deposited into your account when you receive your GST/HST payment.
Will grocery costs continue to rise in Canada?
Unfortunately, food inflation isn’t predicted to slow any time soon.
According to Canada’s latest Food Price Report, Canadians can expect to see a 5% to 7% increase in food prices this year, with the highest increases predicted for grocery staples like vegetables, dairy, and meat. For a family of four, for instance, this translates to upwards of $1,065 more spent on food than in 2022.
Much of the continued rise in the cost of groceries is attributed to supply chain issues, labour shortages and the war in the Ukraine. Because there’s no way to predict for certainty when these issues will sort themselves out, it’s impossible to know when — and if — Canadians will see lower grocery bills or additional grocery rebates in the future.
What you can do if the grocery rebate isn’t enough
With food prices expected to continue to rise, Canada’s grocery rebate will likely make just a small dent in people’s overall food costs. Here are a few other ways to save money on groceries.
Stick to sale items
To cope with grocery prices, many Canadians are already adjusting their diet to cope with inflation by eating more processed and fast foods, which tend to be cheaper.
However, a healthier approach would be to prioritize shopping for items that are on sale and stocking up on those items as much as possible. It’s also not a bad idea to consider giving up a few luxuries — at least temporarily — like eating out and purchasing brand name foods (no name goods can be just as tasty).
Make a grocery budget
Getting in the habit of creating a grocery budget can be instrumental in coping with high food prices. Begin by outlining your monthly grocery costs and then diligently track your spending to make sure you’re not going over budget. You can prioritize essentials like fruits, vegetables, and meats, and only indulge in “extras” like ice cream or snacks when your budget allows it. If you find this challenging, look into using a free budgeting app.
Use a grocery rewards credit card
If you’re already going to be spending more on food, it wouldn’t hurt to reap some rewards in the process.
Canadians are lucky to have access to several fee and no-fee credit cards that reward shoppers specifically for their grocery purchases in the form of points or cash back. These rewards can then be used to reduce the cost of your next trip to the grocery store.
Two of the best credit cards in Canada for grocery purchases are the AMEX SimplyCash Preferred card (which gives you 4% cash back) and the BMO CashBack® World Elite Mastercard (which gives you 5% cash back).
