Inflation is likely to increase more if a sales tax is introduced, a spokesman for Jersey's motor trade says.
The latest figures show the biggest rise in 10 years
Peter Tabb from the Motor Trades Federation believes politicians may put pressure on retailers to help keep prices down.
The latest Retail Prices Index (RPI) figures reveal prices and housing costs are rising at 5.6%, the highest increase in over a decade.
Finance President Senator Le Sueur says competition will bring prices down.
Mr Tabb said: "I was disappointed to hear Senator Le Sueur 's comments on the RPI increase.
"He is falling back on the simple concept that more competition will automatically lead to lower prices.
"In my view it shows a marked lack of understanding of real market conditions in a small marketplace like Jersey."