A survey of small businesses has revealed that almost half plan to raise their prices to coincide with a likely rise in GST.
A 2.5% rise in the goods and services tax has been recommended by a tax review group and the Government again signalled on Thursday intends to do this in the Budget on 20 May.
One in five of the businesses say they do not expect customers to notice any increase, but this is disputed by a consumer watchdog.
The general manager of Accomplish, Grant Hewson, told Nine to Noon that the accounting software provider surveyed nearly 500 small- and medium-sized businesses.
Mr Hewson says 46% indicated they would use the Government's signalled increase to the goods and services tax to lift their prices by more than 2.5% over and above any tax rise.
Twenty-one percent of businesses told Accomplish that customers would not recognise a price increase, because they would associate the rise with the GST change.
But Consumer New Zealand chief executive Sue Chetwin says customers should not be underestimated.
"I think consumers will be quite wise to that - they're expecting a 2.5% increase when the Budget comes out next month.
"If prices go up more than that, they can choose to shop around, they can choose to not purchase or they can actually haggle with the person they're trying to transact with."