Several increases in sight for 2023: your wallet will still taste it

Quebecers are ending 2022 squeezed like lemons.

Several increases in sight for 2023: your wallet will still taste it

Quebecers are ending 2022 squeezed like lemons. Unfortunately, 2023 will give them no respite! Food, gasoline, electricity... The Journal has gone over what could cost you more in the coming year.

• Read also: Debt repayment as a priority for 2023

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After an 11% increase in 2022, soaring food prices will continue in 2023. They will increase by 5 to 7%, according to the latest “Annual Food Price Report” published by four Canadian universities. According to the researchers, a family of four will therefore have to pay $1,000 more for food during the year. Dining out will also cost more. Restaurant menu prices rose some 7% in 2022, according to a report from Restaurants Canada, and are expected to continue rising in 2023.

The Quebec government has decided to limit the increase in Hydro-Quebec rates for residential customers to 3%. SMEs are however excluded from this measure and will suffer an increase of 6.4%, an increase quite similar to inflation for 2022.

Inflation has increased municipal spending by 6% in 2022, according to the Union des municipalités du Québec. The result: property tax increases across Quebec. Residential municipal taxes for Montrealers will increase by an average of 4.1% in 2023. In Quebec City, the increase will be 2.5%, 2.6% in Lévis and 2.9% in Laval. Taxpayers in Longueuil will see their taxes rise by 5.6% in 2023 and Sherbrooke residents by 3%.

Only a few percentage points for the rate of your home insurance, the increase will not be huge, explains Louis Cyr, insurance broker and risk manager. However, your home premium could increase substantially.

"Insurers will start to increase the limits," says Mr. Cyr. A house that was worth $200,000 a few years ago is now worth $300,000. Even if the rate does not increase, the premium will increase.

It should be remembered that the increases over the past three years have been substantial, in the order of 30 to 40%. Currently, the Quebec insurance market lacks competitiveness and insurers' profits are at their highest, says Mr. Cyr.

As for auto insurance, everything will depend on the price of auto parts, which have been constantly increasing lately. Will 2023 give us some respite?

On the business side, we expect a continued increase. The global insurance market has to deal with ever more natural disasters.

Travel demand has been very strong, especially to Europe, this year. With the lifting of most health measures, travelers wanted to make up for lost time. But the offer for the flights reached only 75% of its historical capacity. The effect on prices was felt: travel agents noted an increase in airfares.

In 2023, the companies should restore 100% of supply and demand should return to a more normal level. Result: no significant price increase. Nevertheless, the inflation of recent years is not expected to subside. Prices in the sector have increased by 15 to 20% between 2019 and 2022, according to Mr. Côté.

Quebec limits to 3% the increase in the main rates which are indexed on January 1, 2023, namely those for driver's licenses and registration, the contribution paid in CHSLDs and the contribution for a single or semi-individual room in a center acute care hospital. The contribution rate to the Quebec Pension Plan will increase by 0.5% in 2023. At the federal level, the employment insurance contribution rate will increase by 3%.

In June 2022, motorists paid a record price at the pump: more than $2.20 per litre! If the price has since come back down, several analysts believe that the price could quickly rise again in 2023. Several factors are conspiring against motorists, including the ongoing war in Ukraine, the decline in the number of refineries in North America, the numerous gasoline taxes and the unjustified rise in retail margins at some gasoline outlets. Analyst Dan McTeague predicted a liter at $2.30 in January 2023, on mtlblog.com.

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