Adams Paul: Questions for Oral Answer — Questions to Ministers 
Adams Paul: Questions for Oral Answer — Questions to Ministers 
[Volume:616;Page:11914] 
6.  
PAUL ADAMS (United Future) 
 to the  
Minister of Local Government 
: Does he stand by his statement to the House yesterday that “the removal of GST would not lead to a significant fall in rating bills because local authorities would have to recoup their lost revenue in other ways.”; if so why? 
Hon CHRIS CARTER (Minister of Local Government) 
: 
 I stand by my statement that the removal of GST would not lead to a significant fall in rating bills. Exempting rates from GST would mean that the cost incurred by councils in providing goods and services to their communities would increase as they would no longer be able to recover the GST they paid on goods and services. This cost increase would have to be recouped by collecting additional revenue through rates. This answer clarifies I think my reference to revenue yesterday. 
Gordon Copeland 
: I raise a point of order Mr Speaker. We find ourselves in a degree of difficulty with the answer to this question because for the second day in a row the Minister of Local Government has seriously misled the House in stating that the removal of GST would not actually affect the revenue of local bodies. It is a technicality but that is achieved by zero rating— 
Mr SPEAKER 
: Could the member tell me what the point of order is. 
Gordon Copeland 
: I think the point of order is bound up with the convention that ignorance of the law is no excuse and we are getting an incorrect answer for the second consecutive day and in a way that is misleading the House on this issue. 
Mr SPEAKER 
: Well the member does not like the answer I presume from the comment he is making. The Minister was asked specifically whether he stood by his statement and I heard him say that he did. I could not have thought of a clearer answer to the question. Whether it is the answer the member wants is another issue. 
Paul Adams 
: I ask again does the Minister concede that he was embarrassingly wrong to assert yesterday that removing GST from rates would have little effect on rates bills when every small-business man in the country knows that by zero rating GST on rates local authorities could still receive GST refunds on expenses; and if he does not know that may I offer the Minister a briefing on this following question time? 
Hon CHRIS CARTER 
: No and I inform the House that I invited this member this morning to come to my office to talk about it and I am happy still to do that. 
Mita Ririnui 
: Why has the Government not removed GST from rates? 
Hon CHRIS CARTER 
: GST is designed to apply to the widest range of goods and services supplied in New Zealand. This ensures that the tax is as fair and equitable as possible. The GST regime works best with few exemptions as they can create distortions and extra compliance costs. 
Paul Adams 
: Will the Minister reconsider his policy regarding GST being removed from rates after we have our meeting after question time as it would provide a big saving to ordinary residential ratepayers because I fail to see any reason why he could not? 
Hon CHRIS CARTER 
: Clearly I am happy to talk about this further with the member on another occasion.