Maori Party MP Rahui Katene says the party could reconsider its confidence and supply agreement with the Government if a proposal to increase GST goes ahead.
Prime Minister John Key announced on Tuesday that the Government may lift the Goods and Services Tax from 12.5% to 15%.
The Government says the increase would be offset by increasing social welfare payments and making across-the-board tax cuts.
Mrs Katene says a GST increase would hit those who can least afford it.
If GST is raised, she says withdrawing from the agreement with National would be a possibility, although such a move has not yet been discussed by the party's caucus.
Final details of any tax changes will be confirmed in the Budget on 20 May and Mrs Katene says the party will keep pushing in the meantime for a 1% tax on all financial transactions.
Under that regime, she says people would not have to pay income tax or GST.
[audio:http://www.radionz.co.nz/audio/national/mnr/2010/02/11/maori_party_says_gst_rise_could_threaten_support_for_govt[Listen to more on Morning Report
