The elitist bullshit being vomited up by well fed academics as to why we can’t remove GST off fresh food so that the crippling prices caused by the greedy Supermarket Duopoly are eased amount to ‘let them eat cake’.
Removing GST on food is back in the news, proving some bad ideas just never go away
Sacrificing simplicity
But the beauty of New Zealand’s tax system is its simplicity. Removing GST on food, or some types of food – for example, “healthy food” – makes that system more complex and costly.
There are a number of potential complications.
Let’s start with the obvious – what would count as “food”? Is milk powder food? Probably yes, so what about milk? Or flavoured milk? Oranges are food, so what about 100% natural orange juice? A broad definition of “food” would include lollies, potato chips, McDonalds and KFC, but many would object to removing GST from these on health grounds.
We would then need to decide what is acceptable to exempt and what is not. The arguments would go on and on.
…who gives a fuck?
Hungry Kiwis are scrounging for food, and this academic is wanking on about the need to keep things simple for the purity of Adam Smiths free market architecture?
Get fucked!
Australian supermarkets already remove GST from food and seeing as one of our entire Supermarket duopolies is Australian owned, I’m sure they’ll manage.
Simplicity for your precious tax system doesn’t trump hungry people needing cheaper food!
Next bullshit reason…
Food costs won’t drop that much
Exempting some things and not others adds cost to the system.
Food outlets sell more than just food. With the proposed exemptions some things they sell will be subject to GST and some not. Some predominantly non-food outlets such as petrol stations also sell food.
Ultimately, someone has to pay the cost of complexity and the ones most happy about that will be the accountants.
Another issue is one of expectations. Food prices will drop but not by the full amount of GST. Basic economics teaches us that when something is taxed, producers and consumers share the burden of that tax.
…don’t care, take the tax off.
Next bullshit reason…
Alternative solutions
The working group explained that if the goal was to support those on low incomes, and the government was willing to give up the GST revenue from food, then it would be better to continue to collect the GST and simply refund it via an equal lump sum payment to every New Zealand household or taxpayer.
…let me see if I can get this completely fucking straight.
It’s IMPOSSIBLE to remove GST off food because it’s too complex, but it’s just really simple for everyone else to fill out their tax returns and get some credit at the end of the year?
Fuck off.
Poor people have seen how you claw back and gerrymander the game so that you don’t end up with anything, we want real price drops we can manage directly out of our pocket rather than your accounting torture.
The arguments against removing GST are ideological nonsense denying hungry people cheaper food.
It’s time to get angry at the manner the elites protect their rigged casino.
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Spot on Bomber. Once again the political elites and beltway mandarins are running the show with an arrogant disdain for the rest of us that is now becoming commonplace. Why tax people to then give it back – just don’t tax them in the first place.
Yea just reduce income tax by whatever percent, then we can can buy more healthy food for my kids.
“It’s IMPOSSIBLE to remove GST off food because it’s too complex, but it’s just really simple for everyone else to fill out their tax returns and get some credit at the end of the year? – Fuck off.”
Great summary Martyn
“then it would be better to continue to collect the GST and simply refund it via an equal lump sum payment to every New Zealand household or taxpayer.”
If an “equal lump sum payment to every New Zealand household or taxpayer.” is so efficient, why not consider UBI, especially now?
Nz Government can pick up a telephone, and talk to the Aussie Government on how to any time.
Nah they would prefer to export gang members much more fun conversations between the two nations.
I have noticed the weaker your case the more you swear. I am sure the rich will enjoy their gst free caviar.
Aha! The right’s “great” answer to the universality of benefit.
For once it’s not about the rich. It’s about shifting unfair tax burdens for the common people.
Ya know…
SOCIALISM!
The simplicity argument is reasonable, but then Mr Hickson abandons any notion of simplicity and sense with his payback idea. Why hasn’t this government overturned Key’s increase of gst to 15%? Why haven’t they gone further by reducing it to 7.5 or 5%? The cost of living in NZ is too high.
I agree Bomber. The so called Academics are mouthpieces for the burocratic elitist individuals. Probably lots of sociopaths amongst them.
and how is the tax shortfall to be made up?
abolishing superannuation
cuts to the health service
no infrastructure maintenance
because I’ll tell you for nothing it won’t be made up by taxing property that’s for shit sure.
GST off food wont make much of a difference.
It is nice to be in agreement with you on this one the food would not be 15% cheaper and the profits of the sellers wuld be higher
Yep time for a new “tax switch” to reverse Bill English’s. Cut GST off food and reduce it across the board and hike income taxes to make up the lost revenue.
GST (also along with fuel levies) is a regressive tax that punishes the poor.
The idea that its not simple is bs. If its sold in a supermarket, dairy, green grocers, food shop and its not a cleaning product or a newspaper its likely to be food. That includes all foods healthy food and sugary junk food and food ingredients. If its edible its food. Obviously the supermarket still claims the gst on their food purchases so is under an obligation to pass all of that money onto consumers under fear of prosecution like the covid wage subsidy miscreants.
Joseph In the UK where foodstuffs are VAT free , so are the cleansers and toiletries which also help healthy living. Cleaners etc are very much cheaper than here.
There are good economic arguments for a subsidy, in fact, as the fixed costs of holding fruit and veges are much higher than the fixed costs of goods with a longer shelf life: https://warwick.ac.uk/newsandevents/pressreleases/subsidy_would_improve
Yes i heard some guy, (an advisor to the Government apparently), on Wallace Chapman’s Radio N.Z show wanking on about how difficult it would to define the word ‘food’ and then remove gst off some items and not others etc ..etc..blah blah blah. He reeled off all the scenarios that they have to consider and how businesses could get around it, or initiate court cases etc…blah blah …on he wittered…. He had every excuse under the sun and his excuses sounded weak and lazy.
The obvious answer ,as mentioned ,was to take gst off all food regardless off its’ health status and how processed it is. The KISS theory. People can sort the good from the bad.
Eating healthy food and educating people on the benefits of doing so is a completely different subject.
The answer is there. The desire not!!
You remove GST off of fresh fruit and vegetables and basic everyday items such as milk and cheese. That’s it. Not cream, orange juice, sodas, biscuits or crumpets, cream, mushrooms, or even garden herbs. Just the basics, so that families on low incomes will be able to afford these basics and so that there’s no excuses for the supermarkets to raise the prices of any other items.
A value added tax wouldn’t touch basic food stuffs.
GST off food has been a policy of New Zealand First for years – guess who wouldn’t agree to it? Labour. Even Greens never agreed to it.
If the Ozzies can do it! Oh! That’s right. The NZ government is too woke to do anything popular ay?
To woke to fix the Crises ay?
To woke to address the corruption in local government or in their own bureaucracies.
Food is low on their list of priorities! Don’t you know they’ve got an election to win!
First 50K should be tax free. Consumption taxes are ok in principle but not for essentials like food. Basically the tax system should target anti-social things like unhealthy products, environmental damage, property speculation etc.
” elitist crap ”
Yeah unless they want to do something like cutting the top or corporate tax rate for example or fund some ridiculous project.
Elitist crap indeed.
I think we all know we are being played. Pity there isn’t as much coverage of this betrayal as the blame game on the supermarkets.