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NZ Economic Insight - Will GST Changes Impair the Retail Sector?

The New Zealand government has recently announced that it is seriously considering a possible increase in GST from 12.5% to 15.0% in order to broaden the tax base to gain more revenue. Raising the GST will result in a dollar value increase of 2.2% on goods and services and may prompt consumers to spend up large before the change. Alternatively, the increase may reduce consumption levels and make consumers rethink their original purchase decisions.

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