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Date Published: 27/09/2023

False economy: Half the food items subject to VAT reduction in Spain are now more expensive

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Fruit and veg, olive oil and pasta and rice have suffered the largest increases in supermarkets across Spain

False economy: Half the food items subject to VAT reduction in Spain are now more expensive

Like so many shock measures introduced by the Spanish government to ease the burden of inflation on the ordinary consumer, the VAT reduction on staple food items has been somewhat of a disappointment. Because despite the all-round best intentions, almost half of these products, 48.9% to be exact, are now more expensive than they were at the beginning of the year.

This grim assessment was made by Facua, which released the figures on Wednesday September 27 after conducting a comprehensive price check on 962 foods subject to the VAT cut. To make sure the report was accurate, the consumer organisation sampled items from Spain’s largest supermarket chains: Alcampo, Aldi, Carrefour, Dia, Eroski, Lidl, Hipercor and Mercadona and checked the prices on several different days.

Their feedback shows that groceries have been growing progressively more expensive since January: while in the first month of the year only 6.7% increases were detected, in February this figure rose to 17.4%, in March 30.8%, in April 42.0%, in May 43.8%, in June 44.7%, in July 47.0% and in August, 48.4%.

Overall, of the total products scanned, a whopping 470 now cost more than when the VAT reduction was first applied.

Which supermarkets have hiked their prices?

In short, all of them. Not for the first time, Carrefour has come out as the worst value for money supermarket, increasing the cost of 92 products between January and September. There’s little bang for your buck in Hipercor either, where 88 food items are more expensive.

Next in line is Alcampo, which has hiked up the price of 52.8% of foods analysed, followed by Lidl (50%), Aldi (49.2%) and Eroski (47.3%).

While they’ve still become more expensive, Mercadona and Dia fare the best. The Valencian chain Mercadona has raised the cost of 54 products (39.4%) while 47 increases (36.1%) were found at Dia.

Which foods have become more expensive?

Sadly, most shoppers will probably agree that the price of virtually everything has gone up over the past nine months, but there are certainly a few clear stand-outs. Of the total of 470 more expensive items discovered by Facua, 140 correspond to fruit and vegetables (29.7% of the total), 101 relate to olive oils (20%) and 68 are rice and pasta (14.4%).

Not to be outdone, 66 price increases have been found among milk and dairy products (14%) and 43 among legumes (9.1%). The 50 remaining price hikes correspond to eggs, flour and bread.

Are the supermarkets distorting the prices?

Way back when the VAT reductions were first introduced, several big chains were accused of artificially inflating the cost of food to make up for any losses incurred. Now faced with a similar scenario, Facua has asked the Ministry of Consumer Affairs to look into pricing and sanction companies that are illegally increasing their profit margins on these products.

In other news: EU demands that all airlines allow free hand luggage

Image: Freepik

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