5 Oct 2010

Commission receives GST rise complaints

1:19 pm on 5 October 2010

More than 35 people have complained to the Commerce Commission about businesses they believe are using the GST rise to unfairly increase prices.

The commission says 15 of those complaints have already been dismissed as invalid, because they do not raise any issues under the Fair Trading Act, while the remaining complaints were being assessed on Tuesday.

A spokesperson says the complaints fall into two categories. The first is that a price increase is claimed to be due to the rise in GST, but in reality is significantly more than the increase.

The second concerns retailers failing to change the price on the shop shelf to include the rise, but then charge the extra GST increase at the till.

Under the Fair Trading Act, retailers must change shelf prices to match the charge at the till.

The GST was increased from 12.5% to 15% on 1 October.

Firms hit back at consumer watchdog criticism

Businesses criticised on the Consumer NZ website are hitting back at suggestions they've used the increase in GST as an excuse to raise their prices.

Consumer New Zealand is naming businesses it claims have significantly increased their prices while people were distracted by the GST change.

The website invites people to report businesses that have raised prices by more than the GST increase.

But businesses named on the website say the price rises are legitimate and reflect rising costs.

And they say the price increases weren't universal, with some prices dropping while others remained the same.

Consumer New Zealand says the website reflects public concerns.