Election 2014

21 Oct 2008

National gives assurance it wouldn't raise GST

1:39 pm on 21 October 2008

National Party leader John Key says GST would not be raised to 15% under a National-led government.

Tax specialist and PricewaterhouseCoopers chairman John Shewan told "Nine to Noon" GST may eventually need to rise if the financial crisis worsens.

But on the campaign trail in Auckland, Mr Key says the way to reduce the forecast deficits, is to embark on a high-growth strategy.

He says, in the short-term, all parties are faced with the prospect of borrowing.

But he says raising GST is not on National's agenda, as they want to cut taxes, not raise taxes.

Labour's finance spokesperson Michael Cullen has also ruled out any such increase in GST.

GST (Goods and Services Tax) is added to the price of taxable goods and services at a rate of 12.5%.

It was introduced by the Lange Government on 1 October, 1986. Initially the rate was 10%, which was raised to 12.5% in 1989.