Labour's promise to remove GST from fresh fruit and vegetables reeks of desperation.With his party languishing at 32 per cent in the latest Colmar Brunton poll – a formidable 22 points behind National – Labour leader Phil Goff's desire for a circuit breaker is entirely understandable. However, that does not make his choice any less wrong-headed.
Mr Goff was one of the Labour Cabinet that introduced GST. That Cabinet, for sound reasons, stood firm against union and grassroots party pressure for a range of exemptions, including for food. It is notable that Helen Clark's government did not act to exempt fresh fruit and vegetables from GST, despite having nine years to do so. Nor did Labour vigorously take up Maori Party MP Rahui Katene's proposed exemption for healthy food in a member's bill earlier this year, voting but not campaigning hard for it.
Oh dear. We'd hazard a guess that Phil Goff and his media team cringe whenever someone reminds them of Phil Goff's lengthy ministerial past, or when anyone challenges his attempts to rewrite history. After all, Goff is the frontperson for pamphlets talking about "National's 15% GST" when he and his cabinet colleagues in the 1980's were directly responsible by far the greater part of it. How time dims the memories!
But the leader writer is not finished, noting the can of worms that will inevitably be opened should Labour ever get the opportunity to advance this policy, noting:
They will be asked why those who buy their peas fresh should be favoured over those who buy them frozen – there is little, if any, difference in the health benefits they deliver.
They will be asked why the exemption should apply only to fruit and vegetables, and not to other elements of a healthy diet, such as fish and lean meat.
They will be asked why they do not provide for other exemptions to promote other activities that benefit society – removing GST from bicycles or solar panels, for example.
Finally, they will be queried as to why they don't tackle what many see as more pressing anomalies in the current system, such as the levying of GST on rates.
We reckon that Goff has erred majorly with his focus on such a narrow area. To us the appeal of GST is its universal nature; you buy, you pay. Those with more money to spend will end up carrying a bigger share of the GST burden, and we don't have a problem with that. It's also the easiest tax to administer.
Labour's proposal will be an administrative nightmare. Fortunately, we are not in the food business, but we sympathise for anyone who is, should Labour ever be returned to the Treasury benches. And after Labour's deceit over the Axe the Tax bus trip earlier in the year, could the voter trust them? We have our doubts.
13 comments:
Most New Zealanders will soon discover that the GST rise is costing them much more than they like and will see Labours offer to take GST off food as a good thing.
I think you sense that this is the case and hence your posts and degree of attack.
Goff's onto a good thing here.
Two things about the dance of the desperate that come to mind along with your well made points.
1 Everyone buying something in this country unless it is in the pub over a "fell of a truck" purchase or a "cashie" with a tradesman, will pay the now 15%, so even those of us who have arranged their affairs to minimize incometax exposure will have great difficulty avoiding making a contribution to the IRD with GST.
2 And this should be so embarrassing for the socialists who have railed against the rich pricks getting a larger share of the tax cuts when they ignore the fact that removing the gst on some food items will be giving a much greater saving to those same rich pricks who by choice buy a much greater amount of fresh fruit and Vegetables in their weekly shop than the people the socialists are trying to target and it wont make a blind bit of difference to their stupid life choices.
Has it ever occured to you that Labour was/is actually more right-wing than National when it came to economic matters? Sure they threw in some soft lefty rhetoric to apease the old lefty support base (prostitution, Homosexual law reform, recycling, etc) which ultimately do little to detract from their free-market agenda.
Labour is attempting a grassroots clawback and the stupid (you?) might see this as some sort of commie uprising that might actually help poor people put decent kai on the table...
but they're still fucking scum because essentially they believe in the same old economic shit that National does.
You get all hung up on unions and other 'lefty' shit - smoke and mirrors is all it is.
Your imaginary friend
Santa.
You reckon, do you Robert? What about the alternative hypothesis; that New Zealanders will get a tax cut in their first pay in October, and think "Sheesh, John Key doesn't eat babies after all".
It works for me! I make no apologies for the fact that I will be getting a decent tax cut as from Friday, even if I have to pay a bit more here and there by way of GST. I work hard, and I've paid my dues.
One tax cut in nine years of Labour; two tax cuts in less than two years of National; you do the maths.
It's interesting to look at the coverage of "Red" Ed Milibland's conference speech as the new Labour leader in the UK - he's really putting in a big effort to distance himself from the previous Labour government and he wasn't even an MP at the time of the Iraq vote.
If a bloke that actually is a new face has to work hard to get noticed, what chance does Goff have? What chance does the party have when their entire caucus is stacked with more dead wood than a lumberjack's shed in late autumn?
two tax cuts vrs one tax cut... go National!
yr a fucking simpleton! Watch that tax cut get eaten very quickly...
And gravedigger, do you always look with such hatred? You seriously think poor people are going to resent that other people will also have access to cheaper fruit? Fuck your a loser.
And "socialist's" - what fucking war are you still fighting? I bet you believe any old shit yr told eh?
your imaginary friend,
Santa's little helper.
Apparently Red Ed's speech was bollocks, according to Guido.
@alex. According to me too, based on what saw of it on SkyNews from the UK this morning.
Old Holborn's got a nicely caustic take on things too: http://www.oldholborn.net/2010/09/complete-destruction-of-labour.html
Old Holborns like that.
Unfortunately, taking tax off selected food items will increase the complexity of GST compliance, and with complexity comes cost.
There is no question that businesses can do it - what needs to be quantified is the cost of compliance that is passed on to goods and services across the board, to see if the savings are as great as suggested.
Well Invent, I'm not talking about dyed-in-the-wool blue supporters like you, I'm meaning most of the rest of NZ who think about their lot in terms of what they are getting/not getting. They are the ones who will, I suspect, think "This is a crock! I've got b*gger all from Key. Everything costs more!"
Goff is offering to give them a reduction in the price of veges and fruit. They'll think, "That's good!"
robertguyton - perhaps if Labour also promised to unwind the GST rise they might pick up some support. But realistically the core Labour constituency would be better bribed with a promise to remove GST from junk food.
I think you miss the demographics though. The poor that Goff is targeting with this promise are already Labour or Greens voters. The rest of us wouldn't trade a $2/week saving from this policy for the inevitable $50+/wk increase in our income tax that comes hand in glove with a Labour government.
Rich pricks - building a future based on economic well being, not emotive vote buying.
Anon - I doubt the actual amount matters - it's the thought that counts - a party offers relief from constantly rising prices (seen the figures for the latest petrol price rise?)will gain a lot of support in the present financial environment.
The quibbling from the Right (It'll complicate the GST system, Goff said something different in the past) won't matter a jot. GST-free food sounds like 'free food' and people like that kind of message. I'm not a Labour supporter so I'm just saying how it 'reads'
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