This week, the federal government announced a ban on supermarket price gouging, aiming to get “a fairer go for families in their weekly shop”.

From July 1, 2026, the new supermarket regulations will ban very large retailers (those with revenue of more than $30 billion a year) from charging prices that are:

excessive when compared to the cost of the supply plus a reasonable margin.

Coles and Woolworths are the only two supermarkets big enough to meet this definition of “very large” and therefore face these regulations.

The Australian Competition and Consumer Commission’s final report after its major inquiry into the supermarket sector was released in March. It found they were among the most profitable supermarkets in the world.

However, it did not directly accuse them of price gouging. So, what’s actually changing under the new regulations and could it lead to lower prices for Australians at the checkout?

Price gouging – setting prices at a level far higher than people think is reasonable – isn’t currently illegal for businesses in Australia.

The ACCC will enforce the rules, which form part of the now-mandatory Food and Grocery Code of Conduct. The penalty per contravention for breaching the laws will be the highest of:

But both Coles and Woolworths were quick to voice their opposition to the new regulations, arguing they could drive up costs and cause consumers to miss out on deals.

To price their products, supermarkets consider a wide range of costs for supply, manufacturing, transportation and distribution, warehousing and storage.

They also have to factor in labour, rent and inventory costs that are involved at every........

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