OTTAWA, Jan 26 (Reuters) - Canada's Prime Minister Mark Carney on Monday announced a series of measures aimed at lowering food and grocery costs for low-income families grappling with rising living expenses, including the expansion of a tax credit on food products.
"Global supply chain shocks caused by tariffs, weather events from a changing climate, and geopolitical disruptions have caused food prices to rise faster than overall inflation," Carney said during a press conference.
To help low- and modest-income families cope with high food costs, Carney said the government would increase the GST - a sales tax - credit amount by 25% for a period of five years.
"This will deliver hundreds of dollars more into the bank accounts of more than 12 million Canadians," he said.
Affordability has been a major issue in Canada, especially for grocery prices which have continued to climb despite easing overall inflation.
While the public has repeatedly raised concerns about rising food costs, retailers and traders have continued to pass on price increases linked to adverse weather conditions in key growing regions and President Donald Trump's tariffs.
The government will also provide a one-time payment this year equivalent to 50% of the GST rebate.
The measures would cost the government C$3.1 billion ($2.26 billion) in the first year and between C$1.3 billion and C$1.8 billion in each of the following four years, he said.
The government also allocated C$500 million for capital investment in the food sector, C$150 million for small and medium enterprises and support for food banks and community food programs.
($1 = 1.3688 Canadian dollars)
Reporting by Promit Mukherjee and David Ljunggren; Editing by Ros Russell
