Bay reacts to GST hike

Bay of Plenty social service organisations have expressed anger at the government's decision to increase GST to 15 per cent.
Finance Minister Bill English made the announcement when he read the 2010 Budget on Thursday afternoon.
GST will rise from 12.5 per cent to 15 per cent from October 1.


Tauranga Budget Advisory Service's Marjorie Spicer.

Tauranga Budget Advisory Service manager Marjorie Spicer says the people who can least afford it will be hit the hardest by the GST hike.
"For some of us, there's some give and take. But for most of my clients, they are already dealing with big deficits. They have no cushioning."
It's not just the food and groceries, it's the petrol, the power, the clothing."
Marjorie says record numbers in the Western Bay are seeking budgeting help and the GST rise will make their situation worse.
"The difference between their income and their expenditure is going to be greater than what it is now.
"It's going to be harder for us to help them because the problem is going to be so much greater."

Bill English also announced the lowest tax rate will drop from 12.5 per cent to 10.5 per cent and the tax rate for the nation's highest earners, those who earn over $70,000, will drop from 38 per cent to 33 per cent.
The government says across the board tax cuts will off-set the GST hike.
Tauranga Community Trust Foodbank chairman, Don Brebner, says tax cuts will only benefit the highest income earners.
"Tax changes give a scary outlook for foodbanks, and I would suggest many other social service organisations - particularly non-profit ones.
"These could all face a new wave of need from the poorest of the poor."

Click here to see public reaction to the Budget on video.

Click here to hear Simon Bridges' response to the Budget.

Click here to read Tauranga Chamber of Commerce CEO Max Mason's response to the Budget.

Click here to read Grey Power's reaction to the Budget.

1 comment

Think about the poor

Posted on 20-05-2010 16:27 | By eunice s

I will have to cut down on some of my treats unless my benefits increase. I can survive but I really feel sorry for those I see when I do my weekly Kentucky Fried Chicken. Some of those are really big people, perhaps due to gland problems, and I wonder how they will manage if they have to cut down there food.


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