What's happening

Last updated May 2026

Australia's price gouging ban: what actually changes on July 1.

From July 1, 2026, it's illegal for Coles and Woolworths to charge excessively above cost of supply. Here's what it covers, who it applies to, the penalties, and what it means for your grocery bill.

Pinch tracks real grocery prices at Coles, Woolworths, ALDI and Harris Farm, with 52 weeks of price history on 74,000+ products. From July 1, 2026, the largest Australian supermarkets face a new law making it illegal to charge excessively above cost of supply. Here's what that means in plain English.

What happened and why it matters.

In December 2025, the Australian Government passed regulations making it illegal for the country's largest supermarkets to engage in excessive pricing on grocery products. The law takes effect on 1 July 2026.

The move followed the ACCC's landmark Supermarkets Inquiry, which delivered its final report in February 2025 (ACCC Supermarkets Inquiry Final Report, 2025). That inquiry found something most Australian shoppers already suspected: Coles and Woolworths dominate the grocery market in a way that dulls genuine price competition, and both had increased their profit margins during a period when household grocery costs rose by 24%.

What the ban actually covers.

The core of the new law is straightforward: very large retailers cannot charge prices for grocery products that are "significantly excessive" compared to the cost of supply plus a reasonable margin.

In practice, it's more nuanced. The regulations avoid prescribing a fixed formula. Instead, the ACCC will assess each case taking into account:

• The retailer's actual cost of supply for the product
• Geographic pricing differences, recognising rural and remote stores cost more to supply
• High-low pricing cycles, where the full pricing cycle can be considered, not just the peak price
• The degree of competition in that product category and market

Who it applies to (and who it doesn't).

The ban targets retailers with annual revenue exceeding $30 billion. Exactly two companies meet that threshold:

Covered: Woolworths (~38% market share) and Coles (~29%).

Not covered: ALDI, IGA, Harris Farm, Costco, or any independent grocer.

The broader Mandatory Food and Grocery Code of Conduct, in force since 1 April 2025, applies to all grocery businesses with revenue over $5 billion. But that code protects suppliers. The excessive pricing ban is specifically about what you pay at the checkout.

The penalties.

Maximum penalty per breach, whichever is greatest:

• $10 million
• Three times the value of the benefit from the breach
• 10% of the company's annual turnover

10% of Woolworths' annual turnover would be in the billions. These are not symbolic fines. The ACCC has more than $30 million in additional funding to enforce them. ACCC Chair Gina Cass-Gottlieb has publicly stated enforcement action can be expected as early as the second half of 2026 (ACCC Compliance and Enforcement Priorities, 2026-27).

What it will probably do. And what it won't.

Should do: Create a real deterrent against the most egregious pricing behaviour. Give the ACCC actual teeth. Signal to the market that the government is watching.

Probably won't: Deliver immediate price drops on 1 July. Address the market concentration that gives Coles and Woolworths their pricing power. Cover ALDI, IGA, or independents. Prevent legitimate price increases from drought, supply chain disruption, or input costs.

Proving a price is "significantly excessive" is genuinely difficult. The ACCC will likely start with the clearest cases. Systemic, modest overpricing across thousands of products is harder to identify and prosecute.

Timeline.

How to track whether prices change.

The legislation sets a framework. The real test is what happens on the shelf. Pinch monitors prices across Woolworths, Coles, ALDI, and Harris Farm, updating multiple times per week. As the ban takes effect, independent price data becomes more useful, not less: it gives you a way to check whether prices are genuinely shifting or whether the status quo continues under a new label.