New Zealand First ‘Agrees to Disagree’ Over Tobacco Excise Increase

Rt Hon Winston Peters

New Zealand First Leader
29 November 2019

New Zealand First ‘Agrees to Disagree’ Over Tobacco Excise Increase

New Zealand First has invoked the ‘Agree to Disagree’ provisions of the Coalition Agreement because it cannot support the announced 11.46 percent increase in the tobacco excise from 1 January 2020.

“Studies show that the automatic tobacco excise increases are having less effect on reducing smoking rates, most particularly amongst the target groups of Maori and Pasifika,” states New Zealand First Leader Winston Peters.

“A 1.3 percent decrease in smoking prevalence for Maori, 1.8 percent for Pacific smokers and a decrease among smokers of only 0.7 percent overall between 2016/17 and 2017/18 reveals a policy that has reached the limit of its effectiveness.”

Mr Peters also points to the unintended consequences of the automatic tobacco excise increases, “Customs interceptions of smuggled cigarettes at the border have increased by 352 percent between 2015 and August 2019. Interceptions in 2018 were 53 percent higher than the preceding year. Clearly the price point has reached such a level that organised crime groups see economic opportunity. This places unnecessary pressure on our customs service when it should be focusing resources on preventing the importation of illicit drugs.

“Another unintended outcome of New Zealand having one of the world’s highest retail prices for tobacco products – a typical pack in New Zealand retails for about NZ$31 compared to NZ $1.62 in Vietnam, $5.29 in China and NZ$6.07 in South Korea – is the threat to the safety of the country’s dairy owners from violent burglary.

“Finally, New Zealand First believes the 11.46 percent increase in the tobacco excise is punitive for the many poor New Zealanders who can least afford another price hike. The excise increase disproportionally gouges the poor and New Zealand First cannot support the policy,” says Mr Peters.

ENDS

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