The Finance Minister is refusing to say whether he still believes removing GST from food would be an "absolute boondoggle" amid allegations from the National Party that Labour could be about to announce removing GST from fruit and vegetables as part of its tax policy.
On his way to Labour's weekly caucus meeting, Grant Robertson was asked if Labour was planning to remove the goods and services tax (GST) from fresh food.
"I am not here to speculate about tax policy. As the Prime Minister said yesterday that will be released in due course," Robertson said.
Last year, at an Auckland Business Chamber event, Robertson said GST exemptions can become "an absolute boondoggle to get through".
"If you do it off fresh fruit and vegetables, or even staple products, then you get into an argument of what's the difference between beetroot and canned beetroot," he said at the time.
"If you want to make a real impact on the lowest income people you wouldn't cut the tax off fresh beetroot - that's not what people on low incomes buy."
Asked on Tuesday whether it would be a boondoggle, as he said last year, Robertson replied: "As I said, I am not going to speculate on any tax policies today".
He gave a similar answer to the question of whether it was no longer a boondoggle.
"I am not speculating on any tax policies."
The Finance Minister was also asked whether Labour could do something that differed from Robertson's economic view.
"I have been around a long time and I have seen politicians of all shades have to deal with things that you don't always necessarily 100 percent back at the start. It is the nature of being here. That is all parties, that is all ministers," Robertson said.
"What we stand for is the values and principles of the parties that we are part of. I very much stand with Labour. I am very much committed to being the Finance Minister with Chris Hipkins as the Prime Minister after the election."
Robertson's already had to deal with Prime Minister Chris Hipkins torching a tax-switch proposal that the Government had secretly been working on.
"What I would say is it's an idea that clearly I think had some merit. I wouldn't have put so much work into it if I didn't think that it had merit," Robertson said last month.
"But I also am a team player and I'm also somebody who's very conscious of the economic conditions that we're in."
National's finance spokesperson Nicola Willis last week claimed to have uncovered that removing GST from fresh fruit and vegetables would be part of Labour's tax policy.
She suggested that meant there was division within Labour given Robertson's previous comments on the idea.
"I think Labour's caucus is completely divided on tax. You have got them wanting to pursue a wealth tax, a capital gains tax, all sorts of taxes. That's been kiboshed and now they are desperately flaying around looking for something."
In the aftermath, ministers refused to confirm nor deny it was part of Labour's election policy.
Speaking at his post-Cabinet press conference on Monday, Hipkins said Labour's tax ideas would be released in the new few weeks and National had taken a "guess" at what it would propose.
On Tuesday, Hipkins wouldn't say how he would define fresh fruit and vegetables.
"I am not announcing anything on tax or commenting on a hypothetical policy at this point… When the Labour Party announces its tax policy, I will be happy to answer questions on it."
He wouldn't say if removing GST from fruit and vegetables would be a boondoggle.
Former Revenue Minister Peter Dunne last week said the idea is "far too complex to even make workable".
"What about canned fruit?" asked Dunne. "What about fruit juices or derivatives? The same with vegetable products. Where do you draw the line?"
Dentons Kensington Swan Tax partner Bruce Bernacchi told AM on Friday that the alleged Labour policy would help high-income earners more and it wasn't clear if supermarkets would pass on the full savings.
"It can absolutely work, but is it good tax policy? Well, in my view it's not," he said on Friday.
"It depends whether the supermarkets pass on those cost savings to the consumers and that's one of the concerns with the policy."
The Tax Working Group, the group set up by the Labour Government in its first term and led by former Labour Finance Minister Sir Michael Cullen, recommended against a food and drink exemption.
"GST exceptions are complex, poorly targeted for achieving distributional goals and generate large compliance costs. Furthermore, it is not clear whether the benefits of specific GST exceptions are passed on to consumers."
Te Pāti Māori wants to remove GST from all food. It says this policy would cost about $3.4 billion per year and would lead to families being able to buy on average "seven weeks of free food per year" due to the savings from current prices.
