Thursday 22 July 2010

National refuses support on GST food exemption bill

From Radio New Zealand
Updated at 6:10pm on 21 July 2010

National won't support a Maori Party member's bill to remove GST from healthy foods, saying it doesn't want the law changed.

Rahui Katene's bill would scrap GST from foods, including fruit and vegetables, breads and cereals, milk products and lean meats.

The bill is due to be debated by Parliament, but won't get past its first reading.

Prime Minister John Key says it is difficult to demarcate between different food groups and the loss of revenue - estimated by the Government at $360 million a year - would be high.

Mr Key says the GST system is simple and exempting some items would start a trend.
But Ms Katene says financial transactions are already excluded from GST.

She also says Australia's tax office has a computerised model for GST on food and beverages, which would made it an easy matter to manage.
Copyright © 2010 Radio New Zealand

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