Should we remove GST on food?

No, it's complicated to differentiate between a $25 salad in a high street restaurant, versus the raw ingredients in a green grocer. The general rule is that the more expensive food you consume, the more GST you pay. The less expensive food you consume, the less you pay. Contrary to popular belief, unprocessed locally grown foods are still mostly cheaper (and more healthy) than imported and highly processed foods. Potatoes are cheaper than frozen or cooked chips. A few loaves of bread, and a bag of apples, will make healthier and cheaper kids lunches in comparison to the cost of pies and coke.

Another point is that if the government was too remove GST on food (a significant chunk of our economy), then it would immediately need to cut benefits and raise income tax to keep everything in balance, just as the same rule applies on GST increases. If we differentiated on healthy food, we would never hear the end of lobby groups attempting to get their foods on the healthy list, or "healthy options" from fast food outlets.

If you really want to avoid paying GST on food (and reduce food miles), then grow your own.

Posted: Wednesday 24 February 2010

Comments

  • GST is a consumption tax that hits the poor more than the rich, as the poor spend more proportionately on food. If you believe in that statement then almost any reduction in GST makes sense.
    Posted: 2011-04-12 19:45 by Happyfunball    
  • wht details???
    Posted: 2010-11-17 22:14 by Vikki    
  • It's a stupid idea. In addition to your points, it creates more expensive bureaucracy and I don't believe it would result in cheaper produce anyway. Supermarkets charge what the market will bear. Goff is indulging in the most morally bankrupt vote buying imaginable. Our no-exceptions GST is the envy of Canada, the UK, and other countires with complex consumption taxes. My take on it here: http://www.mywitsend.co.nz/wp/goff-loses-the-plot/
    Posted: 2010-10-11 08:49 by Alan Vallis    

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