When Labour leader David Shearer announced the proposal to drop plans to cut GST from fresh fruit and vegetables Prime Minister John Key made the made the flippant comment that it showed Labour didn’t believe in the policies it put before voters at the last election and that it didn’t know what it believed in anymore.
I must agree with the Prime Minister.
Along with scrapping its GST proposal Labour also proposes to scrap policy to make the first $5,000 of income tax free; scrap plans to increase tax on those earning over $150,000 and scrap plans to remove the Working for Families discrimination against the children of beneficiaries.
In other words all Labour’s meek tinkering to support those on low incomes is to the dropped so that the rich can continue to get richer and the poor continue to struggle.
Labour’s right wing has reasserted itself under Shearer and has a death grip on even these most modest of progressive policies.
These policy back-downs are a betrayal of low-income families while offering reassurance to the wealthy and the corporate sector that Labour is good for the all-important generous corporate donations for the next election campaign.
The GST back-down is pitiful because just a percent or so more tax on the super-rich would enable Labour to keep this policy.
It is not widely understood just how heavy and vicious GST is on the poor. The lowest 10% of income earners in spend 14% of their income on GST while the wealthiest 10% spent less than 5% of their income on GST.
It’s a medieval tax designed by Labour’s neo-liberal robber barons in the 1980s.
GST could be scrapped altogether if Labour introduced progressive income tax policies, a decent capital gains tax and a financial transactions tax.
Consider for a moment that half the small group of super-rich New Zealanders do not even pay the highest income tax rate (they declare incomes of less than $70,000) and yet Labour prefers to leave the heaviest tax burden on those on the lowest incomes.
I don’t think Labour has a clue what it believes in anymore.
Agree. Furthermore, Labour is terminal, unless they have some sort of collective epiphany and remember why they existed in the first place.
Labour needs a strong person to be leader if they want to be successful next election. David Shearer is not that person. Which is a Shame as they won’t get the votes they deserve because of him.
It’s not that they need a strong leader – it’s that they need to stop kowtowing to the business and ownership classes and that’s not going to happen.
Argh. Labour seems so full of clowns right now.
Shearer just another Merrill Lynch supporter.
This is an excellent piece, and exactly mirrors my feelings. In The Netherlands, for example, there is no GST on food, and there never was. GST could and should have been dropped from food during the Clark years.
GST could and should have been dropped altogether. It’s massively regressive and it’s sole purpose was to lower taxes on the rich and place the added burden upon the poor.
Thank you, thank you, thank you Mr Minto for writing a piece on GST, in response to Shearers back down on the plan to drop GST on fruit and vege. You’re right, it is a medieval tax. It’s deeply unfair but amazingly, its rarely discussed, as if its just something we have to accept. We just have to fork out an unaffordable 15% extra on every single thing from a piece of fruit to our medical care like the peasants our leaders think we are.
I predict that if and when Mana and the Greens get 30 or 40 seats between them, most of the Labour caucus would vote to go into coalition with National in order to preserve good old Kiwi capitalism. Social democracy of the Labour type could hand out a few crumbs when the economy and those running it let them, but in a crisis which calls for structural changes, they show their true colours. The sooner they address this contradiction by getting rid of right wingers like Shearer, Jones and Mallard, the better. They’re as useless as tits on a bull, and the Labour brand is so compromised that those who do want to change things should get out of that party. We need to rebuild the working class movement, and this will not be done by dying Shearer’s pale pink underwear a brighter shade of red.
Hmmmm, I seem to recall another Party that did just that in 1996 – NZ First.
NZ First was elected on a policy platform of getting rid of a National government. Instead, on 11 December 1996, they formed a coalition government with the Nats.
In 1996, NZ first was all but destroyed, with Winston winning Tauranga by only EIGHTYFIVE seats
If Labour coalesced with National, it would be thweir death knell.
seats = votes.
I am voting green this back down has made my mind up for certain.
Party and seat christchurch central .
I am a 62 year lifetime labour voter.
I support the dropping of GST on food. But, as a key campaign policy at the last election, it was an embarrassment. It should have been election pledge #17, not something to be stuck up on hoardings. All it did was shout loud and clear to voters that “this is the only idea Labour has got”.
So, for Shearer to dump the policy and make a clean break from the joke that was Labour’s last campaign is maybe not so dumb. Even better, though, would be if he had some decent new ideas to replace it.
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