GST rise fait accompli - where are the gains?
The Finance Minister made a slip yesterday about putting GST up. Coincidentally Rahui Katene's private member's bill on exempting healthy foods from GST was also drawn yesterday.
Mallard rebukes the Maori Party's healthy food exemptions and their support of the budget (because of their coalition agreement).
Well what about water? It doesn't get more necessary or healthy than water. Water should be exempted from GST. That is something that can be done for reticulated water and other supplies of water. It will make it less of a commodity at a time when it is becoming more so every day - witness the Canterbury Regional Council junta the government installed yesterday specifically in order to allocate water to the financial benefit of the farmers.
Once they start putting sales tax up then some alleviation is in order where possible. Charging tax on the water itself is going too far and unlike other products that Trevor Mallard can mock water is something that can be defined clearly.And you would think Rodney Hide - Minister of Local Government and Leader of the Association of Consumers and Taxpayers would be able to get Council rates exempted from GST.
There must be wins for the two main support parties if Bill English is going to put GST up. They have to get something - each of them. And Peter Dunne too - he's Revenue Minister so he should definitely be able to work in something for his constituency... whoever those four or five people may be.
A one-off rise in various base-line items isn't a gain either - whereas a 20% rise in GST is a permanent loss. Permanent. Phil Goff comes back from his "Axe the Tax" tour - that seemed to be singularly built around criticising the idea of putting GST up - only to tell us that they probably won't axe it. That's as good as a "Keep the Tax" policy. In this environment there needs to be some permanent gains to offset the hike.