With food inflation eating into the wallets of Canadians, the federal government has announced that so-called grocery rebate payments will go out on July 5.
The announcement came following the passage of Bill C-46, the Cost of Living Act, by the Senate on May 11. The Liberal government claims the rebate will deliver “targetted” inflation relief to millions of low and middle-income Canadians that have been hit the hardest by rising food prices.
Here’s what you need to know about the upcoming payments.
Who Is Eligible?
Two months ago, when speaking about the upcoming budget, Finance Minister Chrystia Freeland warned that the government could not “fully compensate every single Canadian for all of the effects of inflation,” as this would make the problem worse. However, the minister said the government would provide “targeted inflation relief” for some Canadians.According to the government, a total of 11 million low- and modest-income Canadians will be eligible for the grocery rebate. This includes those whose yearly household income is less than $38,000, as well as individuals who make less than $32,000 per year.
The rebate will be available to Canadians who are already eligible for GST credits, which are a non-taxable amount that gets paid out quarterly to low- and modest-income families to “help offset the goods and services tax/harmonized sales tax (GST/HST) that they pay.” The GST rebate was first offered last year as a way to address cost-of-living concerns.
Is an Application Required?
Canadians will not need to apply to receive the rebate, as it will be delivered to them along with the July GST credit payment. The recipients will just need to have filed their 2021 tax return.How Much Will be Paid?
The grocery rebate, which will cost taxpayers over $2.5 billion, will provide a one-time payment of $234 for single Canadians without children, $225 for seniors, and $467 for eligible couples with two children.According to the government, a hypothetical single mother with one child and $30,000 in net income will receive $386.50, while a single senior with $20,000 in net income would receive $233.50. The money will be provided either via direct deposit or a cheque through the Canada Revenue Agency.
Although Canadians struggling with the cost of living will no doubt appreciate the extra money, its help with grocery expenses may be limited. According to Canada’s Food Price Report 2023 released by Dalhousie University’s Agri-Food Analytics Lab in December 2022, the average Canadian family of four will pay $1,065 more for food than they did in 2022. This amounts to around $16,288.41.
What Can The Rebate Be Spent On?
Despite the money being dubbed a “grocery rebate” there are no mechanisms in place to ensure that it is spent on groceries. Recipients can spent the money on whatever they choose to.The government has not indicated whether the rebate will be a recurring yearly cheque, or a one-time payment for this year. But when announcing the budget on March 28, Freeland called the payment “targeted, temporary relief from the effects of inflation for those who need it.”
