The Lactose and Gluten-free Tax

Wheat and dairy products are staples in many diets all around the world, however not everybody is able to eat them.

In fact, many people suffer from lactose intolerance, non-coeliac gluten sensitivity or coeliac disease, meaning eating these food products can make them sick.

Unfortunately for people with these dietary requirements, alternative options can be more expensive, and not every product is always available.

As experts in understanding how health insurance can benefit those with special dietary requirements, we wanted to find out how much extra it costs for people to buy alternative products that are lactose or gluten free. To this end, we gathered examples for different product categories in several grocery chains over seven different nations and compared prices between the original and the alternative.

Here is a summary of what we found:

Lactose-free and gluten-free price differences by country

If you want to view the full list of the products and prices we collected for each category, click here.

Most expensive lactose-free products

For those shopping with a lactose sensitivity, one of the ways you can make easy substitutions is to look for lactose-free products. Lactose-free alternatives include lactose-free milk, cheese and ice cream, plus other alternatives such as soy products, dairy-free products and vegan products that can also be suitable for lactose intolerant people.

Here is a breakdown of the lactose-free products we looked at on a per-country basis, and how prices differed in comparison to the original version:

Lactose-free products price difference breakdown

Overall, alternative dairy products were 46.43% more expensive than the originals on average.

Regular, lactose-free milk was 49.42% more expensive on average. Interestingly, while soy milk (one of the most popular milk alternatives) was 28.51% more expensive on average – the least expensive dairy alternative overall – in some countries it was actually cheaper than regular milk. In Australia, the soy milk we looked at was 28.13% cheaper than regular milk, and in Canada it was 16.72% cheaper! South Africa is the only nation that we looked at where lactose-free milk was less expensive compared to soy milk (14.24% and 85.67% price increase respectively), although in Hungary, both alternatives were about equally expensive (approximately 88% price increase compared to regular milk).

Of all the alternative dairy products we compared, ice cream was the most expensive. If you are craving ice cream but can’t eat lactose, expect to pay 71.60% more on average than the original!

However, this extra ice cream ‘tax’ will differ wildly depending on where you live. Alternative ice creams also had the least consistent price increase of any dairy-product category. In the USA, we were able to find lactose-free ice cream at the same cost as the original (a 0% increase), and in Hungary the price is only slightly higher (a 11.58% increase). On the other hand, the example we found in Canada was almost triple the unit price (198.43% more expensive), and in South Africa the alternative ice cream was similarly expensive (204.61% increase in price).

Most expensive gluten-free products

Gluten-free products are – as the name suggests – products that contain extremely small amounts or no gluten, depending on national regulations. Alternative food options include gluten-free flour, pasta and bread, but these can be quite expensive compared to regular gluten products.

Here is a breakdown of the gluten-free products we looked at on a per-country basis, and how prices differed to the original versions:

Gluten-free products price difference breakdown

Overall, gluten-free products were on average 217.15% more expensive than gluten foods. This is more than four times the percentage cost increase of lactose-free products.

Of the product categories we researched, gluten-free flour had the highest price jump, costing an average of 310.96% more than the original. Additionally, gluten-free flour pricing was the least consistent out of any product we examined. Depending on where you live, a bag of gluten-free flour will cost between 133.03% more (in Canada) to up to 584.47% more (in South Africa) than the price of a regular bag of flour.

On the other hand, the price increase for gluten-free pasta was far lower, with an average extra cost of just 96.21%.

Availability

One potentially frustrating aspect of shopping for an intolerance – apart from the extra cost – is the limited variety and availability of different products. While researching for this piece, we noticed that lactose and gluten alternative products almost always had fewer options than regular products. Not only were there fewer brands to choose from, but many types of products were simply unavailable in the same size or form factor as the originals.

For example, a search for “cheese block” on Australian grocer Coles’ website (as of the 9^th of August 2023) finds 50 different products, only three of which are lactose / dairy free. These lactose-free cheese blocks are smaller than the lactose-containing counterparts – only 250 grams at the largest compared to one kilogram for regular cheese. Other alternative products simply had less in the box. For example, packets of regular ice creams included more in the box than their lactose-free counterparts.

There was also often less variety with dietary alternatives. In the cheese example, there were three lactose-free cheese blocks; two were cheddar and one was feta. There were no alternatives for other types of block cheese such as Parmesan, Romano or Havarti. This was a common observation across all countries we looked at, in every product category.

Best and worst nations to have dietary requirements

In terms of added cost, Australia, the United Kingdom and New Zealand came out on top overall. On average, Australia had the lowest price jump for dairy alternatives (and was number one overall), while New Zealand had the lowest for gluten alternatives (and was third overall). The United Kingdom was second place in both categories and landed in second overall as well.

At the other end of the spectrum, South Africa came in last place for both lactose and gluten categories, and last overall. Additionally, the ‘diet tax’ in South Africa was also the least consistent – depending on what product you are after you could be paying between 14.24% and 584.47% more! In our research, South Africa also proved the hardest place to find dietary alternatives for specific items. We were completely unable to find gluten-free bread or any lactose-free, hard cheese at either grocer in South Africa (seen as N/A on the relevant data tables).

Dietary requirements and health insurance

If you choose to seek treatment for symptoms stemming from the consumption of gluten and dairy products, you may be referred to a specialist such as a nutritionist. In cases like these, having private health insurance can help cover out-of-pocket expenses incurred from specialist treatment.

It is important to read the Medicare Benefits Schedule (MBS) and consult with your health insurance provider and specialist to determine what could be covered and what may be out-of-pocket.

If you are an Australian looking for health insurance that better suits your needs, you could try comparing health insurance with our free online comparison tool.