Labour's GST-free fruit and vegetables tax policy is being widely panned by experts, who say it is betting on voters' ignorance.
  • Rangelus@lemmy.nz
    3·
    1 year ago

    Absolutely, I’d be much happier with different policies. I think Labour is being frustratingly tentative, and I genuinely don’t understand why. I think this approach will cost them the election.

    My view on this specific policy is there must be some benefit to it. Not only is it implemented all over the world, but I don’t believe politicians make these decisions in isolation. There will be some reason why this policy, specifically, has been chosen over any number of other ones. It might not be a good reason, but there will be one a reason.

    • absGeekNZ@lemmy.nzEnglish
      3·
      1 year ago

      As someone pointed out on another discussion; this is basically a one-way policy decision. Once implemented it is effectively impossible to reverse; so at some point in the past to win votes, a party promised this policy.

      Once the policy is implemented it doesn’t matter how bad / good it is, removing this is a guaranteed vote loser. No party can afford to remove the policy. So it never gets removed and proliferates across the world, and worse people start looking at the prevalence of the policy as a reason to implement it.

      Complicating the tax code is almost always a really bad idea, increasing compliance costs for businesses will be passed onto customers. How does the policy effect cafes, restaurants and other food prep places?

      What about movie theaters, do dried popcorn kernels attract or not attract the tax cost? After they are popped they do since they have been heated, so the customer bears the GST cost but the cinema buys the “raw” ingredient tax free. Are there going to be differences between “naturally” air dried vs oven dried kernels? How much court time is going to be wasted on these kind of questions?

      This was literally the first example I thought of, there will be a huge number of extra edge cases that this policy will have knock-on effects, this just means that things will get more expensive, probably not 15% more but, it will be there.

      • Rangelus@lemmy.nz
        5·
        1 year ago

        @[email protected] has already addressed much of your concerns, so I will only add the following: A lot of this discussion is about possible problems, without seeing the legislation fully written out. You, and others, are assuming that there are guaranteed to be all kinds of problems, without the actual text to point to and say “what about this?”. The point that other countries have enacted this policy without any, or too much, trouble should give you pause for thought that it is possible.

        The point about being unable to remove it is a valid one, and one I share. However, as I (so far) feel this policy is overall positive, I am fine with it. As I said earlier, I think this policy addresses more than just adding a bit of money to your wallet each week. See this Auckland University Law Review article from 2019, which discusses the implementation in other jurisdictions and comes to the conclusion that zero-rating food is a net-positive policy. They also, rightly so in my opinion, point out:

        New Zealand has the advantage of being able to improve on the models of other jurisdictions. This article proposed certain exclusions from New Zealand’s GST base by zero-rating and how these provisions can be structured so as to avoid the problems faced in other jurisdictions. As with the original GST regime introduced in 1986, New Zealand can design zero-rating provisions to lead the world by example. The current New Zealand GST system is widely regarded as a highly effective VAT around the world. This reputation can be maintained if food and menstrual products become zero-rated by ensuring that legislation is carefully implemented.

        Just to make it clear, my issue is not with valid criticism, but with a general dismissal due to perceived potential problems that might arise. For example, if someone can show that this policy would not be net-positive for income and health, or that it would harm vulnerable people, then I would naturally change my view.

        Finally, I don’t buy the slippery slope argument at all. I think this policy should be judged on its own merits, and not with the background of “oooh they might make it EVEN MORE COMPLICATED!”.

        • eagleeyedtiger@lemmy.nzEnglish
          1·
          1 year ago

          Just to make it clear, my issue is not with valid criticism, but with a general dismissal due to perceived potential problems that might arise.

          Finally, I don’t buy the slippery slope argument at all. I think this policy should be judged on its own merits, and not with the background of “oooh they might make it EVEN MORE COMPLICATED!”.

          God this is so common with any online political discourse, especially in here in NZ. Everyone starts thinking up all these potential issues and nothing ever changes. It also tends to reveal a lot of their biases. It’s fine to be concerned about the potential impacts of policy, and even better to plan for it. But doing nothing because almost everything has potential for some negative situations is ridiculous. Nothing any government will ever do will be perfect off the bat and have no edge cases. “Perfect is the enemy of good” and all that.

          So many just jump straight to thinking up negative scenarios rather than trying to imagine what potential positive outcomes there could be, which we could then improve upon.

      • Dave@lemmy.nzM
        2·
        1 year ago

        I like the sentiment but just want to point out something about how GST works. GST is a consumer tax, so for this:

        After they are popped they do since they have been heated, so the customer bears the GST cost but the cinema buys the “raw” ingredient tax free.

        The cinima is already buying popcorn GST free. Only the end consumer pays GST.

        A better example might be a cafe that sells raw apples or bananas, but everything else is “processed” so they would have to do a software update for the sake of one item in the store that not that many people buy.