2. PETER BROWN (Deputy Leader—NZ First) Link to this
to the Minister of Revenue
How much has GST per litre of petrol increased in real terms since April 2000?
Hon PETER DUNNE (Minister of Revenue) Link to this
I am advised that GST per litre has increased in real terms by 6c over the last 6 years.
I do not have that information to hand, but I can tell the House that because the rate of GST is 12.5 percent, the rate of increase over that period of time will have been constant. I can also tell the House that because GST is a consumption-based tax, there is no discernible impact on overall levels of GST income from a movement in one particular item, since people simply shift their budgets to accommodate that change.
Does the Minister accept that much of that increased revenue is a windfall gain, and, noting the United Future party’s objection to a tax on a tax when it comes to rates, will he support New Zealand First’s call to abolish GST on petrol, or at least to reduce it; if not, why not?
The point I made in response to the previous question applies here. The rate of GST receipts over the period in question does not reflect a significant shift, because when people spend more on petrol they spend correspondingly less on something else.
Dr the Hon Lockwood Smith Link to this
What is the Minister doing to transfer a greater amount of the tax collected from petrol towards building new roads, rather than it being diverted into the Crown bank account, consistent with United Future’s policy at the last election—or was the bauble of ministerial office more important than United Future’s policy on petrol tax and roads?
There are two points in response to that question. The area of transfer comes through the excise tax, which is the responsibility of the Minister of Transport.
Hon Dr Nick SmithI am not going to pass the buck; I am going to spend the buck. The second point I was going to make was that as part of the agreement between the Labour-led Government and United Future, the funding previously set aside for the Wellington regional roading programme, initially for the proposed coastal expressway, will now, as a result of the changes that have been made in the Wellington region, be going towards Transmission Gully. That is a huge windfall for the people of Wellington.
Rt Hon Winston Peters Link to this
Has the Minister received reports from his department in respect of prior efforts to divert a far greater proportion of road taxes to roading, in respect of two circumstances: in 1995, when a bill came before this House to do just that, and in 1999, when again the National Government torpedoed such efforts; what reports has he received?
I am certainly aware of both of those incidents, having been in the House at the time. I am also aware that during the term of the last Parliament a very significant diversion into road funding was made, which beat any of the attempts that were formulated over previous years.
Hon Dr Michael Cullen Link to this
Can the Minister confirm that the introduction of GST was accompanied by a very careful programme headed by a committee that recommended a flat rate of GST on the broadest possible range of consumption, and that the chairman of that committee was one Dr Don Brash?