Brash denies plan for lowering GST

Don Brash

National leader Don Brash has quickly stamped on his own apparent suggestion that the party could look at reducing GST.

In an interview with the Rotorua Review community newspaper published on Tuesday, Dr Brash was asked if National could look at reducing or removing the Goods and Services Tax.

He was quoted as replying: "That's one of the issues that can be addressed, to reduce GST."

Finance Minister Michael Cullen leaped on the comment yesterday, claiming Dr Brash's failure to rule out reducing GST meant either that National's tax bill had got a whole lot bigger or he was having another "pooper-scooper moment".

Dr Cullen said that if National's intention was to reduce GST, the only sensible cut in terms of administrative simplicity would be from 12.5 per cent to 10 per cent, costing about $1.83 billion a year on present estimates.

"Alternatively, this is just another embarrassing gaffe which Dr Brash will have to clean up after himself."

Dr Brash's spokesman said National was not planning any change to GST, and claimed he had been answering a hypothetical question.

"Don Brash confirmed for a reporter that cutting GST would obviously be one way to provide tax relief - it's a truism. He did not say it was part of National's plan."

The spokesman said Dr Cullen was "grasping at straws" and engaging in idle speculation.

Meanwhile, Dr Brash yesterday rubbished Dr Cullen's claim that National's spending promises so far total $5.5 billion a year - not including the cost of its tax cuts, which could amount to another $2 billion.

Dr Cullen made the claim in a speech at Rotorua yesterday, saying National had already committed to extra spending.

"No one should be under any illusions as to where these cuts would bite: pensions, health and education," he said.

Asked for a breakdown of the $5.5 billion, Dr Cullen's office said one was not available yet.

Dr Brash said National had costed all its policies but he would not reveal the figures, although he said it was nowhere near $5.5 billion.

CLAIM AND COUNTERCLAIM

Spending

* Labour: National's spending promises in areas such as law and order, roads, defence and aged care will cost about $5.5 billion a year.

* National: Denies claim but refuses to reveal what its promises will cost - though it has done the work.

* Comment: The $5.5 billion figure is probably too high, but analysis is hampered by a lack of information as National is yet to release itspolicies in a number of areas.

GST

* Labour: National may look at reducing GST.

* National: Has no plans to consider reducing GST.

* Comment: Politicking. Finance Minister Michael Cullen leapt on a comment National leader Don Brash made in a newspaper interview more to highlight an apparent gaffe than to seriously suggest National wants to cut GST.