COMMENT What is this week’s special — tax cuts?

• Published date: 28 March 2024
• Author: Arena Williams is the Labour MP for Manurewa.Arena Williams
• Publication title: Daily Post, The (Rotorua, New Zealand)

Instead, National is choosing to prioritise tax cuts rather than doing something about New Zealanders paying some of the highest prices for groceries in the world, while supermarkets and banks make laughable super profits in the New Zealand market and Kiwi consumers are the butt of the joke

Last week the release of gross domestic product (GDP) data for the most recent quarter showed that the country had slipped into recession. This should have been a week where we were talking about the ongoing cost-of-living pressures that households are experiencing. The National Government, which was elected on a promise to tackle the cost of living, should have been able to explain which of the bills it has sprinted through urgency actually help people with rising costs, in particular families on low incomes.

The only policy, announced on Monday, would give families less than the up-to-$130 they were going to get from this month under Labour’s policy to extend 20 hours of free ECE to 2-year-olds. At the same time, it is narrowing people’s access to disability funding and school lunches for kids — which save families an average of $33 per week per child.

It was also the week when Parliament debated Te Pāti Māori’s member’s bill to take GST off all food. This was a welcome opportunity to talk about what the most effective solutions were to make sure that the tax system — and the broader system of social services that it supports — is working for everyone.

The issue of GST on basic necessities was widely debated during the last election. Then-National finance spokeswoman Nicola Willis repeatedly claimed that the benefits of a GST reduction would not be passed on to households because “the most powerful duopoly in the country” of Foodstuffs and Woolworths would simply pocket the saving. These criticisms were repeated last week in the House, with Revenue Minister Simon Watts arguing “one of the biggest beneficiaries of this policy that the member is proposing will actually be the supermarkets chains themselves, not the low-income families”.

That is a valid concern, but the ability of the supermarkets to fleece Kiwi consumers is not limited to potential tax changes. The supermarket duopoly faces weak competition and enjoy enviable market conditions in New Zealand.

But are those ministers saying we must simply accept this exercise of corporate power as a fact of life? Are they telling us it is inevitable that supermarkets make super profits from bread, milk, meat and...