29 April 2010

Action on Smoking and Health (ASH) NZ

Tobacco tax increase to spur quit attempts

The Government has announced an increase in the excise tax on tobacco for the first time in a decade. The price of a packet of cigarettes is set to rise significantly over the next 18 months.

Action on Smoking and Health (ASH) says the initial increase will see a seven per cent hike in the retail price and expect that some smokers will quit in response to the tax increase.

“We will see a number of quit attempts now as well as after the tax increase,” said ASH director Ben Youdan.

“However a bigger increase would have resulted in great numbers of smokers quitting. Last year the tobacco industry discounted prices heavily by around $1 per packet, so even with this increase we are treading water in terms of tobacco affordability.

We’ve seen that the tobacco industry has an ability to take smaller margins and absorb tax increases, and we hope they do not exploit this opportunity to encourage quitting.” 

Tax on loose-leaf tobacco will increase by 14 per cent in an attempt to dissuade smokers who have been switching from factory made tobacco to roll-your-own in recent years.

The tobacco tax will increase in three stages starting on the 29th April, January 2011 and January 2012.

The upside of a staggered approach is that it will give smokers and the support systems around them the time to prepare for quit attempts on a large scale,” concluded Mr Youdan.

-ENDS-

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