this mornings election figures..., page-9

  1. 11,223 Posts.
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    Yes dave 10% GST basic food (things like medical, education and residential rent were always going to be exempt) was the original plan and the way it should have been along with larger tax cuts. These tax cuts were nowhere near the magnitude of abloshing all income tax as you posted as being a good idea the ohter day or even increasing the tax free threshold to $30,000

    But the FACTS are that 10% GST on those few areas would not compensate for the lost revenue from increasing the tax free threshold to $30,000 especially if at the same time low income earners such as pensioners would need greater social sercurity payments to compensate them for the increase in things like the cost of basic food.

    To achieve a neutral or even slightly negative (giving us back some of the surplus) the rate of GST would also need to be increased.

    The arguement for greater consumption tax and reduced income tax is that rewards those that invest and save which has long term benefits for the economy and taxes more heavily those that spend.

    The arguement against such tax systems is that it is not equitable because those on lower incomes where a larger portion of their income goes on basic living expenses food, clothing, housing, carry a greater tax burden in proportion to those on higher incomes who have a larger portions of income remaining after paying for basic items which they can chose to save and not share the tax burden or spend.



 
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