Quebec adopts pricing bill, setting rules for tips and grocery prices

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Quebec adopted a bill on pricing transparency Thursday in an effort to battle price gouging.

Tabled by Justice Minister Simon Jolin-Barrette on Sept. 12, Bill 72 is intended to “protect consumers against abusive commercial practices and to offer better transparency with respect to prices and credit.”

Changes include clarifying grocery and gas prices, giving a framework for tipping practices, and limiting door-to-door HVAC sales.

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Tipping

Businesses will now be forced to exclude provincial and federal sales taxes when calculating a suggested tip.

For example, on a restaurant bill of $100 before taxes, the tip suggestions will be calculated on the $100 and not on the total — $114.98 after taxes.

The 15 per cent tip option will display an amount of $15, not $17.25. Customers will retain the option to determine how much they tip, and each tip option must be emphasized equally prominently.

“In restaurants, more and more people find themselves under pressure with the (payment) terminal,” said Jolin-Barrette. “Previously, people were presented with a bill and then we came back with the terminal.”

Jolin-Barrette mentioned a survey according to which 62 per cent of Canadians said they have left a higher tip than expected because of the choices presented by the payment terminal.

But the bill won’t ban machines from asking for tips when there’s no table service, like at bakeries.

Price transparency and groceries

Grocery stores are now required to clearly identify which food items are subject to the Goods and Services Tax and Quebec Sales Tax at the point of sale.

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Basic groceries such as milk are exempt from GST and QST, whereas snacks such as ice cream and granola bars are taxed. Under Bill 72, the grocery tax amount will have to be displayed at the moment of payment.

Grocery stores will also be required to display the per unit price of bulk and bundled grocery items if the items can be purchased separately, in order to promote price comparison.

When an item is on sale, the regular price must be clearly indicated beside the lower price.

Finally, the price for non-members of loyalty programs must be sufficiently visible compared to the price for members.

The bill also provides for increasing the compensation offered to consumers when the price of an item scanned at the checkout is higher than the price advertised for merchants.

The discount increases to $15 from $10 when the price read by a scanner at the checkout is higher than the price indicated on the tablet or in the flyer. Items under $15 would be free if scanned at an incorrect price.

Limit on “balloon” loans

The bill also limits (but doesn’t ban) so-called “balloon” loans involving negative equity, in which someone adds the unpaid debt on a vehicle they have not finished paying off to the loan for a new vehicle they are buying.

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“In some cases, citizens find themselves paying double what they should for the value of a vehicle,” Jolin-Barrette said when tabling the bill in September.

The larger the value of the “balloon,” the longer buyers tend to spread out their payments, which has other negative effects, he said.

“When the useful life of a vehicle is shorter than the length of the financing, it becomes practically impossible to get out of the debt spiral,” the minister said. “The result is that the debt is deferred once again and the consumer can find themselves paying for an old vehicle that they no longer have for several years.”

Among the conditions that will be set by the government are that the dealer inform the consumer, before the contract is signed, that the loan includes the previous debt. They will also be required to clearly include the amount of the previous debt in the contract.

Limiting door-to-door HVAC sales

Jolin-Barrette said he also wants to bring some order to a sector that generates an average of 400 complaints a year to the Office de la protection du consommateur: heating and cooling appliances as well as insulation and decontamination services.

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Referring to “unfair and deceptive practices” by door-to-door salespeople, he said, for example, that some contractors offer to inspect attics and claim to have found mould by showing photos taken elsewhere.

The new law makes it illegal for a door-to-door salesperson to enter into a sale or lease contract for a heating or air-conditioning appliance, like a heat pump, or for a decontamination or insulation service.

This type of door-to-door sale accounts for more than a quarter of complaints under the Consumer Protection Act since 2019, Jolin-Barrette said in September.

The Canadian Press contributed to this report.

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