Monday, January 24, 2011

Remove Petrol Tax Double-Dip

There are calls for the removal of the goods and services tax (GST) on fuel.
Late last week, unleaded petrol hit near-record levels of $2 a litre, and the Automobile Assn (AA) doesn't believe the government should be charging GST on top of the petrol excise tax as well. Hear! Hear! In many other circles, it's called 'double dipping' and - unless you're the government (that sets its own standards) - that activity would normally drop you deep into boiling water. 
The AA says by removing GST, motorists would save nearly eight cents a litre, offering some relief in the face of steadily-rising living costs and recessional effects.
Petrol prices hit a two-year high at the end of last year, with blame shared by the weakening NZ dollar, Europe's cold snap and an increase in demand as worldwide economies come out of recession. That jump means drivers are now paying an extra 14.2% for petrol!

Going up? 4th floor, poverty..
Compare that to some other changes post-GST-rise:
+Alcohol: up 5.4%.
+Electricity: up 5.8%.
+Milk, cheese and eggs: up 12.6%.
+Vegetables: up 15.4%.
+Cigarettes: up 17%.
+Butter and lettuce: up 50%.

NZ consumer prices rose 2.3% as expected in the three months ended Dec.30, the biggest quarterly gain since a 3.5% rise in Sept.'89, the last time GST was lifted. And bad weather around the world means already high prices have higher to go. Weather conditions have affected food production, and there's talk of the Aussie flood crisis upping food prices here in NZ. Brace yourself!

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