Excessive mark-up attacked by Mr Lange

Press, 30 September 1986, Page 1

Excessive mark-up attacked by Mr Lange

Wellington reporter Retailers who intend to raise prices more than 10 per cent from tomorrow, when goods and services tax comes in, attracted scorn from both sides of Parliament yesterday. The Prime Minister, Mr Lange, said he had seen advertising showing clearly that some retailers would raise prices more than GST mark-up. “Apparently it is perfectly legitimate for people to attribute to GST what is fundamentally their greed ... eventually the public will shake them down,” Mr Lange told reporters. The Leader of the Op-

position Mr Bolger, also pointed to the likelihood of businesses using the new tax to camouflage other price increases. He called on people who thought they had paid an unnecessarily high price increase to write to the Opposition.

Mr Bolger invited consumers to take such complaints to National’s consumer affairs spokesman, Mr Roger Maxwell. The Consumers’ Institute urged people to query retailers about dubious price increases. The institute’s assistant director, Mr David Russell, said that while some

would have GST as an excuse to increase their margins, much of the recent advertising with threatened higher prices from tomorrow was probably just "hype,” designed to spur buying. Mr Russell argued that the Government should have spent more of its tax reform publicity budget monitoring price movements and informing the public about what should be cheaper after wholesale sales tax comes off. The Minister of Housing, Mr Goff, urged landlords not to use the opportunity to raise domestic rents, which are not affected by GST.

Disputing a claim by the president of the Canterbury Landlords’ Association, Mr Jim Glass, that landlords could not just absorb extra costs the tax imposed on them, Mr Goff claimed landlords, like everyone else, would be better off from tomorrow.

Income tax reductions would more than adequately cover landlords’ higher costs, he said. “They should play the game fairly by holding rents or admitting that factors other than GST are responsible for charging their tenants more,” Mr Goff said.

Further report, page 2