OnPoint by Keith Ng

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OnPoint: Updated: GST compensation: Can be done?

65 Responses

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  • Steve Barnes,

    Nobody seems to have mentioned that "Businesses" can claim back all GST paid by that "Business" and I'm pretty sure Trusts can also claim a refund.
    How does this affect the numbers?.

    Peria • Since Dec 2006 • 5521 posts Report Reply

  • Christopher Nimmo,

    15% is a pain - one now needs to divide by 7.6666666....

    Or you could multiply by 0.15?

    (edit - wait, no it's probably not that simple)

    (edit 2 - yeah, I'm being an idiot)

    Of course, it might not necessarily be 15%. They might find a nice roundish number for you to divide by.

    Wellington • Since May 2009 • 97 posts Report Reply

  • Craig Ranapia,

    Property Investors Federation's verdict: "it's nice".

    Compared to getting whacked with a capital gains and property tax, I'm sure it is. But let's go from the headline to the lede:

    The vice-president of the Property Investors Federation is relieved that most housing tax options were ruled out in Prime Minister John Key's speech yesterday, but he is wary of what is to come.[Emphasis added]

    Not exactly a full-throated cry of delight at your obedient bitch rolling over on cue, is it?

    I do wish the Government had gone a lot further towards smashing the Rentier Welfare State, but I don't see what's "intellectually dishonest" about giving a (little) credit where credit is due. FFS, I could extend that courtesy to the evil Liarbore Dykeocracy during the Dark Ages, so see no reason to change now.

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Paul Campbell,

    the way GST works is basically the person who creates something has to pay the govt GST on it - everyone else who buys/sells it (wholesalers, retailers) has to pay the govt GST on the increase in price and whoever ends up with the item ends up holding the bag

    What businesses really do is get to write off the GST they pay vs. the GST they owe - the govt gets the difference (in some cases - exporters in particular - the govt sends them a cheque)

    Dunedin • Since Nov 2006 • 2623 posts Report Reply

  • Just thinking,

    Tom, I've bee looking at house prices vs CV & for some, they're asking 20% below CV from 2008, or land value only.

    For the Christchurch real estate, I think he's pretty much about right, or if you shop around will be.

    Asking $380000
    http://www.trademe.co.nz/Trade-me-property/Residential-property/Houses-for-sale/auction-269615467.htm

    CV $456000
    http://ratesinfo.ccc.govt.nz/PropertyDetails.aspx?RateAccountNum=2042125

    This is not across the board, Mayor Bob Parker got 30% above GV when he sold his Banks Peninsula home to a political finacier of his.

    Putaringamotu • Since Apr 2009 • 1158 posts Report Reply

  • 3410,

    ... but he is wary of what is to come.

    Well, of course he is. He doesn't want any changes that will cost his members one cent, and he knows that such changes are warranted.

    But let's go from the headline to the lede

    What I quoted was from the third para, not the headline.

    I don't see what's "intellectually dishonest" about giving a (little) credit where credit is due

    I don't consider that that's what you did. I've explained my complaint.

    Must go. Have a good one. :)

    Auckland • Since Jan 2007 • 2618 posts Report Reply

  • Sacha,

    What bugs me about all the discussions of the details is nobody is asking the question "Why should we want to pay less tax?"

    Everyone is fixated on where cuts will come from - and not on how they will be paid for (oh look, Keith has it covered) or as you say why to have them at all.

    However, the government could safely argue that they promised tax cuts before the election - and opinion polling since gives them no reason to revisit the question. Given the quality of public debate, so you really think the answer would be all that different?

    Ak • Since May 2008 • 19745 posts Report Reply

  • Sacha,

    ODT obliges - and check that headline straight from the press release.

    The measures will have the effect of broadly reinstating the tax cuts that National cancelled because of the recession, and funding them from elsewhere.

    Elsewhere..

    Ak • Since May 2008 • 19745 posts Report Reply

  • Paul Campbell,

    I saw that pic on the front page this morning - and realised that Lange is still with us, just under really deep cover ....

    Dunedin • Since Nov 2006 • 2623 posts Report Reply

  • Russell Brown,

    Elsewhere..

    Graham Reid's paying for our tax cuts? Does he know?

    Auckland • Since Nov 2006 • 22850 posts Report Reply

  • Craig Ranapia,

    Meanwhile, I've got Bernard's latest proposal for dealing to those smelly, grasping old people. If you're going to have inter-generational warfare, it should have some entertainment value:

    The time of renewal is at hand, mofos...

    North Shore, Auckland • Since Nov 2006 • 12370 posts Report Reply

  • Steve Barnes,

    John Key has just repeated, three times, that he never said "National will not increase GST to 15%" he claims he actually said "National ill not increase GST to 15% to cover deficits". So, if he handed out his latest bribe to the rich of tax cuts without jacking up GST, would that leave us with a deficit? If so then he is raising GST to cover a deficit.

    Peria • Since Dec 2006 • 5521 posts Report Reply

  • Andy Fraser,

    The deficits are already $1b a year higher per annum because of the tranches of tax cuts for higher income earners WEF April? last year.
    Don't discard the possibility that they will borrow to fund part of the future cuts. We are talking about the one party that mortgages our children, remember.

    Invercargill • Since Jun 2009 • 33 posts Report Reply

  • Steve Barnes,

    Didn't Key also say he would not borrow to fund tax cuts?.
    So. The GST increase is not to fund a deficit, it is just so that he does not have to borrow to cover that deficit so he can remain a "Man of his word" and that word is...

    Peria • Since Dec 2006 • 5521 posts Report Reply

  • Kumara Republic,

    Sorry, couldn't resist...

    The southernmost capital … • Since Nov 2006 • 5445 posts Report Reply

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