Let's campaign to remove GST from all food items

by Grant Morgan

Chair of RAM - Residents Action Movement

Great minds think alike.

Inside the RAM Executive the other week we were agreeing that one decisive move the Labour government could easily take to relieve economic pressures on grassroots people would be to remove GST on all food items in the upcoming budget.

Lo and behold, a couple of days later I see a statement from my old comrade Don Franks, now a Workers Party candidate in Wellington, saying: "In a land of plenty, basics like milk and cheese are becoming luxury items. If Labour wanted to implement tax cuts favouring workers, they'd whip the GST off food."

But as Don said, Labour won't do so because "they're a capitalist party who inflicted GST on us in the first place".

As Jim Anderton's Alliance Party used to regularly hammer home in parliament, GST is a regressive tax which impacts far more heavily on the base of society than on the wealthy elites. That's because the have-nots spend all, or almost all, their money week by week just surviving, and so their entire income is subject to a GST tax of 12.5%. By contrast, the haves spend only a portion of their income on living luxuriously. And only this portion attracts GST. The rest of their income, which might well be the biggest portion, is invested to make even more private wealth for themselves alone, and these investments (surprise, surprise) are excluded from the GST net.

So GST is an unfair, class-based tax designed to kick the grassroots in the guts so that the wealthy could have their top tax rate slashed from 66 cents in the dollar (as it was under Rob Muldoon's National government) to a present top rate of 39%. Yet to hear the screams of the elites, you'd think that a top rate of 39 cents in the dollar was almost tipping decent society into the red-hot fires of full-blooded Communism. If GST was dropped from food, this would benefit the have-nots most of all, which is why the haves always call for a cut to income tax (especially the top rate) rather than GST. The wealthy always protect their own class interests, never mind about the poor.

As chair of RAM, I would urge a united campaign to compel the government to remove GST from all food items. I would like this to be supported by all left-wing groups, trade unions, social movements and others concerned about the increasing hardships of people who cannot keep a roof over their heads as well as feed their families.

I'm not sure if the Maori Party and/or the Greens have already made such a call in parliament. (Can anyone tell me?) If they have called for GST to be knocked off food, let's back them up and spread what they've said. If they haven't, then c'mon Tariana, Pita, Hone, Te Ururoa, Jeanette, Sue, Keith and the others, how about you all supporting this call?

Such a united campaign would go a long way towards challenging the basic "more market" ideology that is driving both Labour and National, and in its place start to create an alternative vision of a human-based society.