Family Affairs

April 2010 - GST on Basic Food Items

With the minimum wage being raised by 25c an hour (equivalent to $10 a week) and a proposal that GST be raised to 15 % or more, is it now the time to take GST off food items?

Family Affairs is concerned that many families are going without basic food items e.g. milk, eggs, cereal, etc because of the steady rise in the cost of food. Current food prices mean that an extra $10 a week in a family's pay packet will buy them a loaf of bread, 2 litres of milk and if you're lucky, a box of breakfast cereal. Meanwhile most food items have risen in price over the past year, and adding another two and a half percent to GST, which will raise the prices even further, is going to cause extra hardship to low income families.

Much has been said in the past about childhood obesity and diabetes caused by too much sugar, junk foods and a lack of a balanced diet. Teachers have noted that children in their classes are falling behind because they don't have breakfast before coming to school, and therefore have no energy and lack the attention span necessary to learn.

Removing GST from food would go some way towards making it more affordable for people to shop for more nutritional meals and bring back a healthier lifestyle. While there are breakfast clubs at a lot of schools which ensure children do go to class with a full stomach, these clubs have to finance their service, so is this rise in GST going to affect their ability to help these children? Are we going to see a fall in the availability of this service?

Is it time to remove GST from basic food items?