Supermarkets hit back at Labor’s price gouging ban
Supermarkets and retailers have warned that the government’s ban on grocery price gouging could backfire, criticizing the move as unprecedented and unfair because it targets only the largest chains.
The Albanian government will announce on Sunday it will ban price gouging at Coles and Woolworths, following a damning report by the competition watchdog earlier this year that found Australian supermarkets were among the most profitable in the world.
Coles and Woolworths make up nearly three-quarters of the supermarket industry.
Australian Competition and Consumer Commission (ACCC) launched an investigation in 2024 into major supermarkets accused of failing to pass on savings to consumers during the cost of living crisis, but failed to prove the companies were price gouging.
Under the amended Food and Grocery Act, supermarkets must only charge a reasonable margin on products. The new rules will come into force on July 1, 2026.
“We are cracking down on supermarket price gouging to help Australians get a better deal at the checkout,” Treasurer Jim Chalmers and Deputy Minister for Productivity and Competitiveness Andrew Leigh said in a joint statement.
“The ban will prohibit very large retailers from charging excessively high prices compared to the cost of supply plus a reasonable margin.”
The ACCC will receive a $30 million funding boost to oversee the new regulations. As previously reported, Coles and Woolworths face a maximum fine of $10 million if they are found to have breached the rules.
Australian Retail Association chief executive Chris Rodwell warned that regulating profit margins risked making essential food items more expensive, with grocery prices driven mostly by operating costs such as energy and transport.
“The ACCC Supermarket Inquiry found no evidence of excessive pricing,” he said.
