English encouraged by inflation figures
Finance Minister Bill English today described the latest inflation figures as "encouraging", noting the GST increase had not prompted significant changes.
Finance Minister Bill English today described the latest inflation figures as "encouraging", noting the GST increase had not prompted significant changes.
Statistics New Zealand announced today that consumer inflation had increased 4 percent in the year to December, including a one-off impact of about 2 percent from the GST increase.
"As Parliament's Finance and Expenditure Committee noted last month, the Reserve Bank expects inflation to remain comfortably within its 1-3 per cent target band in the next few years," Mr English said in response to the figures.
"It's encouraging that the central bank is not seeing any significant changes in price or wage setting behaviour as a result of the rise in GST, given the offsetting reduction in personal income taxes.
"That's a far better position than we inherited in 2008, when inflation was running at more than 5 percent and we were deep in recession."
Mr English said New Zealanders on welfare benefits, Working for Families and New Zealand Superannuation were immediately compensated for the GST rise October 1.
"Taxpayers across all income bands also received personal tax cuts, which left someone on the average wage about $15 a week better off from the income tax/GST switch."
NZPA
Thu, 20 Jan 2011
Thu, 20 Jan 2011
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English encouraged by inflation figures
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