Fruit and vegetable growers fear they will be the losers if a plan to increase GST goes ahead.
The Government is expected to raise GST to 15 percent as part of a package of tax changes to be announced in the May budget.
But Horticulture New Zealand is worried that any increase in GST is not likely to be reflected in retail prices for fresh fruit and vegetables, and instead, growers will end up having to absorb this cost.
"The cost of the tax increase gets passed back down the supply chain to the grower, so they make even less on their produce than they do now," president Andrew Fenton said.
"We understand one Auckland supermarket is already advertising that it will not pass on the extra GST in its pricing.
"Not only will growers' returns reduce by 2.5 percent if the proposed increase in GST is approved, but it will further reduce the viability of many growers who are already struggling to survive."
