The National Party is claiming Labour will soon announce a tax policy that includes removing the goods and services tax (GST) from fresh fruit and vegetables.
That could lead to some savings for New Zealanders when they head to the supermarket. GST is currently charged at a rate of 15 percent on all goods and services, including food.
But tax specialists say the emphasis should be on the "could", arguing there's no guarantee supermarkets wouldn't just hike up prices.
Let's say the supermarkets do fairly pass on the savings and take several common fresh fruit and vege items - bananas, apples, mandarins, carrots, tomatoes and potatoes - at their current prices at Countdown.
Bananas at $3.79 per kg would become $3.30, apples at $3.70 per kg would become $3.22, mandarins at $6.50 per kg would become $5.65, carrots at $2.99 per kg would become $2.60, tomatoes at $9.39 per kg would become $8.08 and potatoes at $3.89 per kg would become $3.38.
The policy that Labour may announce - at least according to National's Nicola Willis and which Labour hasn't denied - would be limited to fresh fruits and vegetables.
Te Pāti Māori on the other hand wants to remove GST from all food. It says this policy would cost about $3.4 billion per year and would lead to families being able to buy on average "seven weeks of free food per year" due to the savings from current prices.
"GST is a regressive tax that impacts lower income whanau who are forced to spend nearly every cent they earn," the party said.
"Removing GST on food would make a real difference for whanau who are facing soaring supermarket prices that are only getting worse as the cost of living rises. It will help whanau who are living pay check to pay check."
So if the ideas would lead to cheaper food for Kiwis struggling with the current cost of living issues, why are some tax experts so against it?
Dentons Kensington Swan Tax Partner Bruce Bernacchi told AM on Friday that the alleged Labour policy would help high-income earners more and it wasn't clear if supermarkets would pass on the full savings.
"It can absolutely work, but is it good tax policy? Well, in my view it's not," he said on Friday.
"It depends whether the supermarkets pass on those cost savings to the consumers and that's one of the concerns with the policy.
"There are two concerns, the first is that everyone benefits when you reduce GST or remove GST on fresh fruit and vegetables so that's your low-income earners and your high-income earners. And on an absolute basis, your high-income earners, because they tend to spend more at the supermarket, actually benefit more from this policy."
The Tax Working Group, the group set up by the Labour Government in its first term and led by former Labour Finance Minister Sir Michael Cullen, recommended against a food and drink exemption.
"GST exceptions are complex, poorly targeted for achieving distributional goals and generate large compliance costs. Furthermore, it is not clear whether the benefits of specific GST exceptions are passed on to consumers."
The group found that while a greater proportion of lower-income households' weekly expenditure goes towards food and drink than higher-income families', wealthier people spend more.
"The Group estimates that the removal of GST on food and drink will benefit a household in the highest income decile by $53.03 per week, whereas a household in the second lowest income decile will benefit by $14.35 per week"
While Labour campaigned in 2011 on removing GST from fruit and veges, the party's current finance spokesperson has previously spoken against it - as recently as May.
Speaking to Newshub Nation following the Budget, Grant Robertson said taking GST off all food could "start another debate about whether you should take it off takeaways or not".
"Other countries have had this. Is it a cooked chicken or a frozen chicken? You know, you end up in these sorts of debates when actually you can do more by delivering support to people's incomes while getting those competition issues right."
Robertson said it used to be Labour Party policy to remove GST from fresh fruit and vegetables
"It just doesn't deliver the difference. And to be frank, if it's low and middle-income households, you know, there are better ways of us delivering support to them, which is what we've done."
On Thursday, as ministers were refusing to confirm or deny it was a Labour policy, new Revenue Minister Barbara Edmonds said there are always compliance issues with taxes, but other countries had taken GST off food.
However, when countries have moved to take GST off food, there have sometimes been issues about what food the exemption applies to.
For example, in Australia, GST applies to crackers, biscuits, wafers and pretzels, but not to bread. There was a federal court case over whether an oven-baked Italian "flat bread" was a bread or cracker.
Speaking to media in Christchurch on Thursday, Hipkins said he understood Willis had "purporting to announce Labour's tax policy", but "she is just going to have to wait and see what it is, the same as everybody else is".
"I am not going to announce National's tax policy," he said. "They have had multiple tax policies in the time that we have been in Government. They can announce their policy. We will announce ours in due course."
Asked why National was announcing Labour's tax policy, Hipkins responded: "They are not."
