Tobacco Taxes Raised in NZ

April 28, 2010 New Zealand Taxation

The Tobacco IndustryThe New Zealand Government has passed a new law raising national excise taxes on cigarettes and tobacco, with additional increases planned for the next three years.

On April 28th the New Zealand Government announced the passing of laws immediately increasing excises taxes on cigarettes and loose tobacco. From April 29th, the excise duties on cigarettes rose by 10 percent, and 24 percent for loose tobacco sales. A further 10 percent increase is scheduled for all tobacco products on January 1st 2011 and January 1st 2012. Under the immediate change, one kilogram of loose tobacco faces excise taxes of NZD 492.86. According to Government estimates, the changes will yield approximately NZD 205 million annually in extra collections.

Tariana Turia, Associate Health Minister of New Zealand, announced the tax increase, saying, “If this legislation contributes to saving just one life then it has done its job but I am in no doubt that it will save hundreds of lives.” She continued to say “I know the increase may seem harsh to some but the health of our families, whanau and community is paramount and we need to do everything we can to deter people from smoking.” Conversely, the excise tax also increases have already received widespread criticism. Roger Bull, Chairman of the New Zealand Association of Convenience Stores, has claimed that the new increase places a greater value on cigarettes, and subsequently puts store owners at a greater risk of robbery and possible violence.

Photo by Cayusa