Why do you want to know?
Stuff has a headline: Supermarkets say groceries are actually cheaper here than in Australia and UK
The first point to make here is that the comparison is of a basket of products chosen by Foodstuffs NZ. It’s … not impossible… that a basket chosen by an Australian or British retailer might give a different result.
The second issue is that the comparison was of prices before GST/VAT. Australia and the UK don’t impose sales tax on some of the items in the basket but NZ does. Since the difference between PakNSave and Aldi Australia was about 7%, the impact of tax on the comparison on the comparison is pretty big. Comparing the pre-tax prices makes NZ prices look lower. Is this appropriate? It depends on why you want to know.
If you wanted to know whether moving to Australia would make your groceries cheaper, then you’d want the actually existing prices that include sales tax. If you wanted to know whether the evil NZ supermarket duopoly was exploiting helpless Kiwi families, you might want the pre-tax prices, since that’s where the hypothetical price-gouging would hypothetically be happening.
Foodstuffs are clearly focused on the evil supermarket duopoly question (taking the “Nay” side) so it does make sense for them to look at pre-tax prices.
Thomas Lumley (@tslumley) is Professor of Biostatistics at the University of Auckland. His research interests include semiparametric models, survey sampling, statistical computing, foundations of statistics, and whatever methodological problems his medical collaborators come up with. He also blogs at Biased and Inefficient See all posts by Thomas Lumley »