GST on food grossly unjust

LETTER

While Treasury and the Government are no doubt delighted that rising food prices increase their revenue from 15 percent GST on every purchase made, sadly for low-income families these prices and the GST will add to their hardships. A disproportionate part of low-income families’ income is paid on tax on food purchases, compared to the proportion of income paid by high income families. Food is not an optional purchase. We all have to eat.

Australia, Canada, the UK and others do not have GST on their groceries. Their more compassionate governments recognise that food is a necessity and is needed to keep everyone, and especially children, in good health — so saving on health costs.

It is amazing that so many economic commentators continue with the myth that 15 percent GST on groceries is a fair and simple tax. It is not when imposed on essential purchases such as food. It is grossly unjust.

When will our policy makers follow the example of sensible governments and remove GST from groceries, and ensure that all our children have enough to eat?

Rosemary Michie

Rotorua

While Treasury and the Government are no doubt delighted that rising food prices increase their revenue from 15 percent GST on every purchase made, sadly for low-income families these prices and the GST will add to their hardships. A disproportionate part of low-income families’ income is paid on tax on food purchases, compared to the proportion of income paid by high income families. Food is not an optional purchase. We all have to eat.

Australia, Canada, the UK and others do not have GST on their groceries. Their more compassionate governments recognise that food is a necessity and is needed to keep everyone, and especially children, in good health — so saving on health costs.

It is amazing that so many economic commentators continue with the myth that 15 percent GST on groceries is a fair and simple tax. It is not when imposed on essential purchases such as food. It is grossly unjust.

When will our policy makers follow the example of sensible governments and remove GST from groceries, and ensure that all our children have enough to eat?

Rosemary Michie

Rotorua

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Julian Michael Tilley - 4 months ago
Hi Rosemary - this extract is from the NZ First website - Finance and Tax Policy.
Ensure that most of the food an average family puts in their supermarket trolley each week will be GST exempt. New Zealanders currently spend 14 percent of their household income on food at home (USA only half of our percentage) and pay the fifth highest prices for food in the world.
This policy is estimated to cost $3 billion per year and will be funded by clamping down on tax evasion and the black economy (estimated to run at $7 billion annually).

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