Election 2023 debate moments: Winston Peters backtracks on GST policy, stresses need for 'stable Government' while scrapping with David Seymour

New Zealand First leader Winston Peters has backtracked on a major tax policy, no longer promising to exempt basic foods from the goods and services tax (GST).

His party's policy manifesto dropped just minutes prior to his appearance in TVNZ's Multiparty debate on Thursday night, revealing New Zealand First wasn't proposing to exempt the likes of vegetables, meat, dairy and fish from GST as previously promised.

Instead, the manifesto said New Zealand First will "secure a Select Committee Inquiry into GST off basic fresh foods". 

"We must examine if this would deliver real benefits for taxpayers before legislating for it. We would want to ensure savings get to consumers before we support legislation to this effect," the manifesto said.

That is quite different to a previous promise from Peters.

In a July 23 speech, a version of which remains on the New Zealand First website at the time of writing, Peters made his position clear. 

"In this cost of living crisis, we are going to exempt basic foods, like fresh food, vegetables, meat, dairy, and fish, from GST," Peters said. 

Those comments were reported at the time - and can be viewed at about 20:25 in the video above - but during the debate Peters wouldn't acknowledge that had been his party's policy.

"It's not in the manifesto, check it out… We said, our problem was we thought the supermarket duopoly would just take the profits, it would never get to the people.

"We said we want a full investigation as whether it will work or not but we will be reserving our judgement now, if you had been patient enough rather than trying to have a catch-you moment."

An argument made by Peters in his July speech - that other countries do this, so why not us - has been deployed by the Labour Party with its promise to remove GST from fresh fruit and vegetables. New Zealand First may be trying to distance itself from Labour policies considering Peters has said he won't work with the party.

A policy of removing GST from all food is being proposed by Te Pāti Māori, with co-leader Rawiri Waititi saying during the debate it was about giving "our people some integrity and some mana".

"Give them a decent shot at life in ensuring we take GST off kai,and also breaking the duopoly. It isn't an and/or, it's an and/and."

The idea of removing GST from food has been criticised by economists. The Tax Working Group previously argued removing GST from products wouldn't necessarily lead to benefit for consumers as supermarkets may just hike their prices.

It was also found to benefit higher income households more.

Labour has said it has received reassurance from supermarkets the benefits would be passed on and has established a Grocery Commissioner to ensure this happens. 

ACT Party leader David Seymour said during the debate while he would like to see tax decline, and it would over time, the party's current focus was cutting Government waste and bringing inflation down. ACT watered down its tax cut plan after the state of the country's books was revealed last month.

The Greens want an 'Income Guarantee' package for all New Zealanders, which includes a tax-free threshold and shifts in income tax brackets paid for by a wealth tax, a new trust tax and a higher company tax rate.

National's tax proposal was also mentioned despite the party not being represented in the debate. Moderator Jack Tame asked if any of the leaders thought National's plan was credible.

No leader spoke up. None of the four leaders voiced support for Labour's GST proposal either.

Possible National-ACT-NZF Government?

Elsewhere in the debate, Peters made it clear his top priority after the election was forming a "workable, far better, stable Government", stressing the need for politicians to "put aside our ego" to make it work.

Yet despite those statements, Peters and his possible future Government partner, Seymour, were at eachother's throats throughout the televised debate, giving their opponents more ammo to present them as a coaliton of chaos.

"If you're voting for the National Party, this is what you are voting for. That is pretty high-risk," Shaw said, gesturing to Peters and Seymour after the pair scrapped.

The dynamics between Peters and Seymour are of interest given the latest Newshub polling shows National would need both New Zealand First and ACT to form a Government after October 14. A Newshub-Reid Research poll also found 63 percent of Kiwis think a National-ACT-New Zealand First Government would be chaotic.

Early on in the debate, Seymour was asked whether he trusted the New Zealand First leader, who he has both previously severely criticised and been the subject of attacks from.

"The problem is I don't know where he stands on any issue," Seymour said before listing issues which he believes Peters has flip-flopped on. 

Peters called the response "rubbish".

Seymour eventually said he didn't trust him.

Peters was asked the same question.

"There will be people out there tonight who are saying, 'For goodness sake, start growing up. We need adults in the room here.' The crisis is so serious that on election night we are going to have put aside our past."

The New Zealand First leader said it was "not my job" to trust Seymour.

"It is my job to convince my caucus colleagues who will make the decision, not just me, and everybody who votes for my party that this is the thing we must do. You have got to establish trust, and this is not a very good start now."

Seymour said: "Unfortunately, I am just telling the truth."

Peters said: "No, you're not. Grow up."

The pair continued to spar throughout the 90-minute debate. 

At one point, after Seymour said Peters had given Labour the ability to form a Government, Peters said Seymour should get some trousers and "behave yourself".

"[National leader Christopher Luxon] will expect you to do that as well. So get ready," Peters said.

Seymour hit back: "I will. We will send you a card."

The ACT leader later also said Peters had had "many chances" to make his desired change.

Peters then said: "I am going to have many more."

Shaw, who had multiple one-liners aimed at Seymour, said people who vote for the Greens are "voting for more Green ministers sitting around the Cabinet table with Labour".

"That is what we are campaigning on and there are a myriad of other things that might happen. But, ultimately, we are campaigning to be returned to Government with Labour and in Cabinet so we can influence the shape of that Government."

Waititi said: "We have been in Opposition since 1840 with the signing of the Te Tiriti of Waitangi and look at what happened with the coalition back then, it is still affecting us now."

"I heard the statement around adults in the room, I haven't seen any yet, not on this panel."

He said he wouldn't allow Government to "claim the wins of Māori over the last 183 years based on poor performance, based on continuing to harm our people".