Fruit and vegetable growers fear they will be the losers if a
plan to increase GST goes ahead.
The Government is expected to raise GST to 15 percent as part
of a package of tax changes to be announced in the May
budget.
But Horticulture New Zealand is worried that any increase in
GST is not likely to be reflected in retail prices for fresh
fruit and vegetables, and instead, growers will end up having
to absorb this cost.
"The cost of the tax increase gets passed back down the
supply chain to the grower, so they make even less on their
produce than they do now," president Andrew Fenton said.
"We understand one Auckland supermarket is already
advertising that it will not pass on the extra GST in its
pricing.
"Not only will growers' returns reduce by 2.5 percent if the
proposed increase in GST is approved, but it will further
reduce the viability of many growers who are already
struggling to survive."
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