The Government is set to ban fees for in-store card payments.
Why it would be nuts to scrap GST
I don’t often disagree with Fran O’Sullivan but her suggestion (July 26) to remove GST from butter and other food is nuts.
I chaired the committee which designed our GST in 1985 and we recommended that GST apply to everything. Why?
Three reasons.
First, exemptions radically increase the compliance costs of small businesses which collect the tax on behalf of the Government.
Second, if food is exempt, why not children’s clothing, books and doctor’s bills? In no time, the whole system is riddled with exemptions and compliance costs skyrocket and revenue drops sharply – revenue which has to be recovered from other taxes.
Third, most of the GST actually paid on food is paid by people who can well afford to pay it. In other words, eliminating GST on food is a very inefficient way of helping those who really need help.
Don’t change our GST system: thanks to the Fourth Labour Government and subsequent governments which have held fast in the face of silly advice, we have one of the best GST systems in the world.
There are much better ways of helping those who need help.
Don Brash, Tauranga.
NZ not the same as UK
People writing in support of Winston Peters’ immigration stance seem to be either misinformed or do not understand the issue.
You cannot compare New Zealand with the United Kingdom, the European Union or the United States. The UK and EU are having to deal with the arrival of “boat people”, and the US with land border arrivals from Central and South America. Both systems are subject to corrupt “people traders” who make money from human misery.
New Zealand, through its isolation, can control immigration. The trick is to get the process right based on needs.
Winston is banging his drum of immigration yet again. It shores up a support base but is not necessarily helpful.
Bruce Fletcher, Remuera.
Costs of transactions
I believe the claim that the removal of surcharges for contactless payments and credit cards aids transparency is incorrect and that it would, in fact, hide the cost of these transactions, which will be added to the price paid by customers.
What is concerning is the large amount of money streaming out of New Zealand to pay the charges for these payment methods.
The beneficiaries, like Visa, are overseas-based.
Contactless payments incur less resource costs than other forms of payment and yet incur higher fees (in New Zealand but not in Europe).
It would be useful if the minister examined the real costs and looked for a cheaper, more local solution.
David McMahon, Sunnyvale.
Fee ban an opportunity
The Government’s move to ban fees for in-store card payments gives banks and credit card companies a golden opportunity to earn some positive PR by removing the charges they levy as well. They have ample scope to do this within their usurious credit card debt interest rates, especially given the increasing use of cards against cash.
However, I’m not holding my breath. In recent years, there has been a relentless drive by banks to reduce costs and services. Cash transactions seem to be next in line, although bizarrely high-tech coin-counting machines have recently been introduced at some branches.
Two factors appear to be at play: first, bank staff seem to be strongly incentivised to find new ways of continuing the cost/service reduction mantra, and second, very few people bother to change banks so there is little danger of losing market share.
Open banking may be the ultimate answer, but don’t expect the current operators to vote for an early Christmas on this one either.
Duncan Simpson, Hobsonville Point.
Horrific scenes
The story in the World section asking “Is it too little too late?” (July 28) offers horrific insights into Israel’s starvation of 2 million people in Gaza. Sickening photos of children, but no shortage of food on thousands of trucks at the border, blocked by the Israeli military, whose members are accused of shooting those crazy with hunger hoping to feed their famlies.
Imagine only four food outlets in Auckland and no clean water in our homes. We would see the same desperate, frenzied stampede for survival.
There have been decades of Israeli occupation and military oppression, the killing of thousands of Palestinians. Hamas killed 1200 Israelis on October 7, 2023.
We witness Israel’s disproportionate response - homes, hospitals, schools and key infrastructure destroyed, and the death of 59,000 Palestinians in Gaza, plus thousands of amputees, orphaned children and psychologically damaged human beings each day on our screens.
Does this make Israelis more secure? Does this prevent or ensure a whole new generation of Hamas fighters for justice?
Laurie Ross, Glen Eden.