ZB

Act's cost of living package: Scrap tariffs on chardonnay and bikkies

Author
Claire Trevett, NZ Herald,
Publish Date
Thu, 21 Jul 2022, 11:34am
David Seymour. Photo / NZ Herald
David Seymour. Photo / NZ Herald

Act's cost of living package: Scrap tariffs on chardonnay and bikkies

Author
Claire Trevett, NZ Herald,
Publish Date
Thu, 21 Jul 2022, 11:34am

The Act Party has set out its remedy for the cost of living crisis, including giving international supermarket chains an easy path to set up shop in New Zealand and removing the remaining tariffs on imported goods from some countries.

Act Party leader David Seymour set out the package in Wellington today, saying the Government had to do more to lower the burden on people after the latest CPI release showed inflation was at 7.3 per cent for the year to June, and high inflation was expected to last for some time.

He criticised Labour's temporary fuel tax cuts and a cost of living payment for low earners as "gesture politics".

Act's package includes allowing foreign supermarket chains from OECD countries to bypass the Overseas Investment Act process, so they could bring more competition into the market more quickly.

The Government has made some moves to boost competition in the sector, including a law change to stop supermarket chains using covenants to stop rivals starting new supermarkets.

Seymour also proposed cutting out most of the criteria employers had to meet to bring in staff from overseas under the Accredited Employer Work Visa scheme, including abolishing labour market tests, the wage rule, and transfer restrictions. He said the country was in a "labour crisis" and the tough rules were constraining the labour market more and clearly not needed.

He said all remaining tariffs on goods being imported into the country should also be removed, rather than held on to to use in free trade agreements.

New Zealand still has low tariffs on a raft of goods from a number of countries, which are primarily for use in negotiating free trade agreements.

Seymour said unilaterally removing them would reduce the costs of clothing, food and equipment imported into New Zealand by $200 million per year – saving New Zealanders a bit more money.

The levies include clothing, chocolate biscuits, chardonnay, railway locomotives, and ambulances as well as cosmetics mainly from countries with which there is no free trade agreement in place. Seymour said it would cut about $20 from the cost of a school uniform.

He said the tariffs were of limited use in trade negotiations anyway and had the effect of dampening competition, allowing domestic producers of the same goods to charge more.

The rest of Act's ideas include setting up a materials equivalence register, forcing councils to allow people to use substitutes for building materials such as Gib plasterboard.

It would also allow councils to get a cut of GST, provided they boosted residential development.

Finance Minister Grant Robertson has put inflation down to global pressures such as the Ukraine war and ongoing supply issues from the Covid-19 pandemic. Last Sunday, he announced the fuel tax cuts would be extended until January next year as would half-price public transport.

Seymour said bold change was needed: "[People} are sick of Labour blaming everyone from supermarkets, to fuel companies, to Vladimir Putin.

"Kiwis shouldn't have to just accept that New Zealand is too expensive. Act doesn't accept that and with the right policies and the political will to make them happen it doesn't have to be."

The final four points in its plan are its pre-existing policies for a two-rate tax structure, RMA reform, removing the current dual mandate on the Reserve Bank, and reversing workplace relations measures such as Fair Pay Agreements, an extra public holiday, and bringing back 90-day trials.