Facua, the consumer rights association, updated its price analysis on Thursday, reviewing how costs have shifted since the start of the year. The focus remains on VAT reductions for basic foods. Recent figures show that 48.4 percent of products in August were higher than their January levels. Staples like bread, flours, milk, cheeses, eggs, fruit, vegetables, legumes, and oils are affected by 0% VAT in certain cases and 5% VAT for others, with a typical rate of 10% in the past. In plain terms, the price trend did not align with the policy expectation that these items would become cheaper due to VAT relief, yet many products grew more expensive.
Facua based its assessment on field data gathered from major retailers including Carrefour, Día, Eroski, El Corte Inglés, Lidl, Carrefour, and Mercadona. The study examined 976 products and found that 471 of them carried higher prices on August 30, 2023, than on December 30, 2022. The association notes that only 6.7% of products rose in January, and the share of higher prices has climbed steadily since then, reaching 48.4% in August and marking a near one-and-a-half point increase from July. [Citation: Facua price analysis August 2023]
Facua has signaled that it will escalate its monthly complaints to the National Markets and Competition Commission (CNMC), which has not yet replied. The association reminded that royal decree law sets a rule that price increases for these products should reflect actual cost increases. Facua argues that some spikes may be due to profit margins along the food chain, a practice that would contravene the royal decree and warrant CNMC scrutiny to determine which increases are cost driven and which are margin driven. [Citation: Facua price analysis August 2023]
CNMC analysis
The regulatory body has not issued a direct response to Facua’s prior requests. Earlier this month, it published a report that examined the distribution sector and considered input from the Ministry of Economy and Business Support, evaluating whether the VAT reductions were applied correctly in supermarkets and food stores. The assessment found the measure to be properly implemented in practice. The analysis did not, however, close the door on ongoing scrutiny and further questions from Facua. [Citation: CNMC report on VAT reductions, August 2023]
Three weeks later Facua returned with additional data, highlighting Carrefour as the retailer with the largest share of price increases among the big chains. The French group topped the list, with more than half of its products showing higher prices in the field study, followed closely by Lidl and other major chains. The detailed breakdown identified 471 price increases, with 144 belonging to fruits or vegetables (30% of the total), 93 to olive oils (20%), and 63 to rice and pasta (13.4%). The association also reported almost 70 price increases in milk and dairy products, about 38 in legumes, and several other items, including eggs, flours, and breads. A notable example cited was a Fuji apples product in Alcampo, rising from 1.43 euros in January to 3.69 euros more recently, and two kilos of oranges at Aldi increasing from 2.39 euros to 5 euros. [Citation: Facua price analysis August 2023]
These findings are presented as part of Facua’s ongoing effort to verify how VAT relief translates into consumer savings and to identify where price pressures may be misaligned with policy goals. The group stresses that monitoring by the CNMC is essential to ensure transparency across the food supply chain and to prevent unwarranted profit-taking at the expense of shoppers in Spain and beyond. [Citation: Facua price analysis August 2023]