Foodstuffs has rebuffed claims that New Zealand’s food prices are rising at a higher rate than in overseas markets, citing the goods and services tax (GST) gap in evaluation.

“As two external reports highlighted recently, global factors play a big role in New Zealand food prices,” said Chris Quin, MD of Foodstuffs NZ.

“What both didn’t mention – and what others who compare prices here with those overseas tend to overlook – is that most OECD countries have lower or no GST on some or all grocery foods.”

For example, Quin noted that Australia does not impose GST on meat, fish, produce, cheese and eggs, plain milk and cream, bread and spreads, bottled water, tea and coffee, cooking ingredients and oils, or infant formula.

Similarly, the UK and Ireland do not charge GST on most grocery foods.

Quin’s comments came in response to the Commerce Commission’s Annual Grocery Report, which linked the inflation to the supply chain disruptions caused by Covid and the Ukraine conflict.

The executive also sought to address an Australian academic pointing out New Zealand’s heavy reliance on imports and exclusion from global supply chain corridors.

Stats NZ’s data showed that the country’s food price inflation accelerated 1.2 per cent in September.

Foodstuffs argued that taking GST into consideration, New Zealand has one of the OECD’s lowest rates of food price inflation.

“To be clear, this is not a call to remove GST from food in New Zealand, as we think our simple low-cost tax system makes sense,” said Quin.

“But it is important to be conscious of all factors at play when comparing prices here to overseas.”