We assess the inflationary effects of fiscal transfers by leveraging advances in the identification of fiscal policy shocks within the recently proposed rotational invariant time-varying structural vector autoregression. Our analysis suggests that the fiscal transfers shocks can explain the bulk of the contributions to the post-pandemic in- creases inflation until mid 2021. Thereafter, inflation has been mainly driven by supply chain and demand shocks. In addition, we find that fiscal transfers were essential for preventing a decline in real output per capita similar to the one experienced during the Great Depression.