New Zealand Could Save $3.87 Billion Though Tobacco Tax

July 29, 2015 Taxation in New Zealand

WELLINGTON – The New Zealand government could save billions in healthcare costs if the government maintains its firm stance of annual tax hikes on tobacco products.

Earlier this week researchers at the University of Otago released the results of a new study showing that the country will see significant savings in health care costs, if the government persists with regular hikes to the rate of taxes levied on the sale of tobacco products.

The research simulated the impact that tobacco taxes would have on the instance of 16 various diseases commonly faced by smokers in New Zealand.

It was shown that continuing to raise tobacco taxes by 10 percent each year will result in the saving of 260 00 quality adjusted life years by 2031.

The decrease in the instance of the diseases will result in the saving of NZD 3.87 billion in costs to the health system.

It was also shown that the rise in taxes will lead to a reduction in the health inequalities between non-Maori and Maori.

Photo By: Marius Mellebye / 276ccm