Raising GST

LittleSal wrote: The Govt has to do something as the country is currently borrowing $250million per week! Come budget time that means spending will be cut and additional revenue will need to come from somewhere. There really aren't that many options available and we can't keep expecting the govt to stay at the status quo. We really need to think beyond the price of our groceries and look at the economy as a whole.

I couldn't agree more with this comment

kellie wrote: Star wrote: I don't know how the proposed tax cuts will offset the GST increase? Whats the point of doing it if there is no gain? I believe there will be a gain generated through visitors to the country. Tourists spend alot of money and won't be affected by tax cuts

Yes, plus there are many people not paying tax at all or not paying the correct amount of tax in NZ eg high earners who know all of the tax evasion tricks in the book. Therefore increasing the GST rate is meant to generate more revenue than what they would get from taxes as it is fairly difficult to get out of paying GST on your groceries. That's my take on it anyway. Plus I have heard media economists saying that the admin costs of recuping GST are less than that of PAYE but I'm not sure how.