MEDIA RELEASE: Easing Impact of GST Welcome

Easing the cost of living by dropping GST from fruit and vegetables is a welcome step - but better taxes are needed to properly address inequality in Aotearoa, according to the Better taxes for a Better Future campaign.

Labour's GST policy is an acknowledgement that our tax system disproportionately impacts the less well off, says Better taxes for a Better Future spokesperson Glenn Barclay.

"To see this acknowledgement in the policy of a major party is encouraging," Glenn Barclay says, "It will provide important help to struggling families."

"Our campaign calls for better taxes to ease the impact of tax on the less well-off in Aotearoa, and better taxes to promote good health - we're pleased Labour's policy embraces both these goals."

"Other countries like Australia have similar GST exemptions, so we know it can be done," says Glenn Barclay.

Labour's tax announcement also signalled a willingness to introduce a digital services tax.

"Initiatives to ensure multinationals pay their fair share of tax are also welcome," says Glenn Barclay, “A digital services tax has been under consideration through the multi-lateral OECD process, but this is taking a long time.

"It's great to see Labour express willingness to introduce a digital services tax by 2025 if a multi-lateral solution can’t be found," says Glenn Barclay.

"We really need significant changes to Aotearoa's tax system to properly address the challenges we face as a country - including inequality and climate change - and to better fund public services.

"We're disappointed Labour is not looking at more fundamental reforms of our tax settings - such as moving to properly tax wealth and the returns on wealth, and to grow revenue,” says Glenn Barclay.

"The modest tax-switch proposal they were looking at for Budget 2023 would have been a more meaningful step in the right direction - towards a tax system that asks a little more of those who can afford it and less from those who can't.”

Policy factsheet.