I need you guys to answer a question for me. Bill English said:
If you want to stop people spending more, put GST up, but of course that has a big impact on people, particularly on lower incomes, so it’s not a straightforward issue.
Now the first bit is a bit dodgy – putting up prices doesn’t really make people use fewer dollars, but I think I can see what he is aiming for.
But my question is “why does an increase in GST hurt low income people more”. Try as many reasons as you can, and then one day we can look at them.