The New Zealand Taxpayers’ Union is praising New Zealand First Leader Winston Peters for his announcement of a policy to cut excise tax on tobacco.
Union spokesman Louis Houlbrooke says, “Tobacco tax is truly nasty – it disproportionately hits the poor, it takes food off the table, and it’s fuelling dairy robberies and an illicit market.”
“Despite smokers contributing far more in tax revenue than they cost the health system, politicians tend to scapegoat them as cash cows. The public doesn’t show much sympathy for smokers, so it’s risky for a politician to go to bat for them. We’re impressed with Winston Peters’ courageous stance.”
“If the next government cut tobacco tax, the revenue loss may be less than expected. That’s because under current tax settings, international criminal operations are making a killing illegally importing cigarettes, evading tax, and undercutting legitimate retailers. Recent busts from Customs indicate organised criminals evade up to $3 million in tax in a single shipment – and most aren’t caught.”
“A lower tobacco tax rate, in conjunction with better enforcement at the border, would see a greater proportion of smokers obtain their cigarettes legitimately, restoring lost excise revenue.”
“One small aspect of New Zealand First’s policy appears to be misguided: there is no need for a subsidy or special tax treatment for cigarette alternatives. Vaping products are already far cheaper than cigarettes. The real barrier to smokers making the transition is the incoming regulation that will limit the availability of flavoured vaping products and restrict the ability of businesses to advertise these products to smokers.”