Mr. Chair and committee members, today I aim to address three key issues before the committee: carbon pricing, sales taxes on food and the prospect of implementing a Canadian SNAP program.
Let's talk about the carbon tax first. The question of whether the carbon tax serves as a convenient scapegoat for high food prices is not the right question to ask. Instead, this is what we should inquire: Is the carbon tax negatively impacting the competitiveness of our food industry? Carbon pricing undeniably holds significant weight in Canada. Nevertheless, it is imperative that we rigorously evaluate its effects on the affordability of food for Canadians and the long-term competitiveness of our industries. Unfortunately, comprehensive analyses in this regard have been lacking, and much of what we have encountered appears to be influenced by biased narratives. The efforts of our team of 10 researchers at Dalhousie University have shed light on the scarcity of research in this area.
The Bank of Canada's estimated 0.15% inflation figure applies solely to the direct impact of the carbon tax on three products included in the CPI—gasoline, heating oil and natural gas. This estimate does not encompass second-round or pass-through effects. As a research team, we believe it is challenging to quantify how the carbon tax affects food retail prices due to the multitude of factors influencing prices, starting with consumer behaviour. Our primary focus at Dalhousie has been on industrial and wholesale prices, where we have identified noteworthy disparities between Canada and the United States.
While the elimination of the carbon tax is not advisable, a temporary pause on any carbon pricing policies affecting our food supply chain should be considered until we gain a clearer understanding of their impact. We are diligently continuing our work and anticipate releasing reports soon.
With regard to CRA rules, regrettably, many Canadians are unaware that over 4,600 items in grocery stores are subject to taxation, or they incorrectly assume that taxes apply exclusively to unhealthy products. This misconception needs clarification. We estimate that grocers levy taxes ranging from $300 million to $700 million on items that in our opinion should not be taxed. Prepackaged, healthy salads with a premium price tag, Canadian-made natural bars and an increasing number of “shrinkflated” products, among other examples, are all subject to taxation.
Ottawa can provide immediate relief to Canadians by eliminating all sales tax on groceries. Taxing essential food items is regressive and raises ethical questions, particularly during a time when food affordability poses challenges for many. It is high time for a meaningful dialogue about which food items should be subject to taxes in grocery stores.
The final area is a national nutrition coupon program. As the government in Ottawa explores avenues to assist food-insecure Canadians, it may be an opportune moment to consider launching a national nutrition coupon program fund specifically designed to support children and families who generally cannot afford healthy food. This program could resemble the Canadian adaptation of the supplemental nutrition assistance program, or SNAP, commonly known as the food stamp program in the United States, but it would be inspired by farmers' markets across the country and supported by farmers' markets across the country. Those programs actually exist in Canada—in Nova Scotia, Montreal and B.C. We just need to nationalize it.
Such a program could be meticulously targeted to provide essential grocery store assistance to those in dire need. Through this initiative we could empower Canadians to purchase healthy, locally sourced food products and support farmers, thereby supporting our agri-food sector and ensuring access to a nutritious diet for us all.
Thank you, Mr. Chair.