Labour promises GST off fruit and vegetables

Default Profile ImageBen O'Connell
Labout Promised GST

Ben O’Connell

The Labour Party has unveiled its promise to take the goods and services tax (GST) off fresh and frozen fruit and vegetables should they be re-elected in New Zealand’s upcoming 2023 general election.

If they form the next Government, Labour will put the policy in place next April. The policy is predicted to cost $2 billion in lost GST revenue, and save the average household around $20 each month.

Labour Leader Chris Hipkins dropped the package in Lower Hutt over the weekend. It comes as part of Labour’s & 10 point plan to help New Zealanders with the cost of living, with two more left to announce through the campaign.

The cost of living continues to grow. This year New Zealanders are facing the highest food inflation rate since September 1989, per Stats NZ.

Driving the changes are fruit and vegetable costs, which increased 6.2 percent from July 2022 to 2023.

Critics of Labour’s proposed scheme say the GST removal policy will be hard to implement, and that there are more efficient and effective ways of helping out low-income New Zealanders.

National leader Christopher Luxon responded to Labour’s policy saying it would be retailers getting the savings and not Kiwis. When speaking to media, Luxon said there is nothing in Labour’s new tax package that will help low and middle-income workers.

Both National and Labour have ruled out wealth tax and capital gains tax promises as part of their 2023 election packages.
Te Pāti Māori have taken Labour’s policy a step further, calling to remove GST from all food sales in Aotearoa. They also plan to make the first $30,000 of income tax free.

The Green Party will campaign on a wealth tax of 2.5 per cent on assets over $2 million owned by individuals, or over $4m on assets owned by couples.