Goff Phil: Goods and Services Tax (Exemption of Healthy Food) Amendment Bill — First Reading 
Goff Phil: Goods and Services Tax (Exemption of Healthy Food) Amendment Bill — First Reading 
[Volume:666;Page:13806] 
Hon PHIL GOFF (Leader of the Opposition) 
:  
The member who has just finished speaking Craig Foss did not have enough information to debate during the 10 minutes he had. 
Labour will be supporting the Goods and Services Tax (Exemption of Healthy Food) Amendment Bill to go to the Health Committee. We think we should hear the arguments in relation to whether exemptions should be made. This is a chance to hear from the experts. It is a chance to line up the officials and ask what the difficulties would be in exempting some categories of basic necessities from GST. Most important it is a chance to let the public have their say on this legislation. 
I want to know why National is frightened to send this bill to a select committee where the debate can be had. National should have the courage of its convictions. If it thinks that exemptions are so bad and that its arguments will stand up to that scrutiny then it should subject them to that scrutiny. I say to Mr Foss that he should not run away from the debate which is exactly what National is doing. 
Craig Foss 
: I raise a point of order Mr Speaker. The member speaking questioned the courage of members in the House and I believe that is beyond the Standing Orders. I ask him— 
The ASSISTANT SPEAKER (Eric Roy) 
: Oh— 
Craig Foss 
: I have not finished. 
The ASSISTANT SPEAKER (Eric Roy) 
: I do not need any assistance. I am listening carefully. When allegations are made against a party or against its style it is outside the margin of implying that individual members do not have courage. To say a member is running away from the debate—I do not think he has crossed that line. I am listening carefully and if he crosses it I will pull him up. 
Hon PHIL GOFF 
: Labour does not support the breadth of the exemptions that are proposed by the Maori Party and if the bill goes to the select committee we will be moving to limit those exemptions to a particular area—that is fresh fruit and vegetables. 
GST was brought in at a low rate and it was brought in to be comprehensive. That low rate was 10 percent. The rate that National is now introducing on 1 October of 15 percent—contrary to the sincere promise that it made at the elections; John Key broke his word—is 50 percent higher than the rate at which it was introduced and 50 percent higher than the rate at which our Aussie cousins pay GST across the Tasman. And Australia exempts food products. As a result of what this National Government is doing the GST rate as a proportion of GDP in New Zealand will become the fourth highest in the 30 countries of the OECD—the fourth highest. So the National Party cannot claim that GST is at a low rate. 
The thing about consumption tax is that it disproportionately hurts lower-income earners. It is a regressive tax. At the same time as the Government is hurting lower-income families it is giving tax cuts to the highest earners. One-third of the tax cuts—33 percent—is going to National’s wealthy mates the top 5 percent of income earners. Exempting fresh fruit and vegetables would be a way of giving some relief to those lower-income families. It is much fairer. 
More than that we know from the study done by the University of Auckland School of Medicine that when we take the tax off items like fresh fruit and vegetables people consume more of them. The medical experts are saying to us that if we want to improve nutrition then we should take the tax off fresh fruit and vegetables. The World Health Organization reports that we have the third-highest rate of obesity in the world—the third-highest rate of obesity in the world—but what is this Government doing about it? It is doing nothing. It could do something in a very positive sense. If we took this tax off to improve nutrition the cost of it would be small. It would cost $200 million to $250 million which is the same amount that National took in increased excise duties from those who smoke. If it is good enough to tax people more to stop them consuming then the Government should take the tax off something we would like them to consume more of.