In a recent NZ Herald article "Taking GST off the Kitchen Table" Mark Smith ASB economist states "The benefits from our tax system is it's simple, and it is broad-based, so distortions from the tax system as a whole are relatively low. This tends to promote more economic efficiency."
The article completely ignores the injustice of low income families paying a much larger proportion of their income on GST paid on their grocery bills than the proportion paid by high income families. We all have to eat and families of approximately the same size and ages need about the same amount of food.
The article cites the UK, Europe (and I would have included Canada) as having tax free grocery food. Allan Bullot of Deloittes said this would not work as well in New Zealand. Are our politicians and civil servants less competent than those in the mentioned countries? Also not mentioned was New Zealand having extremely high poverty rates. Those countries without taxes on food much less so. Could there be a connection between these two factors?
Also not mentioned was New Zealand's reported increase in cases of rickets and scurvy. What a national disgrace in this land of plenty.
One can only hope that the several investigations into tax reforms will produce positive results regarding 15 per cent GST on groceries.
