31 May, 2005

Taxing Times Ahead

As the cost of our favourite tipple goes up...again

Consumers are being warned to brace themselves for further tax hikes on their favourite tipple effective from tomorrow (1 June).

The excise tax rise of 2.8% (indexed to annual inflation) on all alcohol beverages is a move that simply defies commonsense, says chief executive of the Distilled Spirits Association, Thomas Chin.

"With the Government's coffers firmly in the black with a $6.5 billion surplus, it's illogical and unnecessary to be enforcing new tax increases that will hit consumers in the pocket yet again," says Mr Chin.

"The Government already reaps $180million in excise tax and duty each year, just from spirit drinkers alone."

Currently $15 excise tax is collected on each standard 1litre bottle of spirits, meaning spirit drinkers pay almost twice as much tax as drinkers of other alcohol beverages.

Mr Chin says the excise tax increase is a yet another slap in the consumer's face in an already seriously over-taxed society, which will see more than 70% of the cost of an average bottle of spirits going into the Government's coffers.

"There is absolutely no policy rationale to explain why spirit drinkers pay almost twice as much tax as drinkers of other alcohol beverages."

"If economic times are as bright as the Government would lead us to believe, then it's high time New Zealand consumers got to keep more of their money. Every year Kiwi drinkers have been walloped by tax hikes making their favourite drinks more and more expensive and increasingly out of reach."

"The pre-election period is a time when politicians should be trying to win votes, but clearly taxing the spirit out of drinkers will not be a vote catcher."

ENDS

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