Eric Crampton: NZ Initiative Chief Economist on Labour's plan to remove GST from fruit and vegetables
Early Edition with Ryan Bridge · Newstalk ZB
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Show Notes
Criticisms of Labour's latest election promise are rising.
The party's promising to axe GST from fresh and frozen fruit and veggies from April, with the average household expected to save roughly $20 a month.
But New Zealand Initiative Chief Economist Eric Crampton told Kate Hawkesby that these policies always end up costing more in revenue than they deliver to families, and make the tax system more complex.
He says the accounting gets more difficult, and lawyers have a field day on definitions of what's included and what isn't.
Labour's also promising to boost In-Work Tax Credits by $25 a week, and lift the Working for Families abatement threshold.
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