Higher taxes on 1 January will punish poor

Thu, 20 Dec, 2018

The Government’s decision to raise tobacco taxes on 1 January will punish the poorest New Zealanders, says ACT Leader David Seymour.

“Tobacco taxes are failing to reduce smoking levels. Despite virtually doubling the rate of excise, smoking rates have fallen by only a few percentage points.

“A new EY report commissioned by the Government shows fewer than half of smokers have responded to tax increases by buying fewer tobacco products.

“More concerning is the fact that 1 in 10 lower income households are going without the basics in order to buy tobacco.

“The Government pays lip service to concerns about the cost of living, especially for poorer New Zealanders, but is persevering with punitive tax increases.

“The average smoker will soon pay about $3800 in tobacco tax each year - that’s money families could be spending on food and clothing.

“Tobacco taxes are quite literally taking food out of the mouths of some of the poorest children in this country.

“At the same time, onerous new restrictions on vaping have been announced, meaning fewer people will quit smoking.

“Smokers already contribute far more in taxes than the costs to the rest of the community caused by their smoking. Further taxes simply punish people and represent a $2.2 billion tax revenue grab. 

“The Government needs to quickly reverse this failing, regressive policy.”