Tax Hikes Force Smokers to Quit in New Zealand

September 28, 2015 Taxation in New Zealand

WELLINGTON – Constant hikes to the tax applied on the sale of cigarettes and tobacco in the last four years have forced have reduced cigarette sales by nearly a quarter.

Over the weekend the New Zealand Smokefree Coalition and Endsmoking NZ issued a joint statement claiming that new data provided to the national Ministry of Health indicates that the rates of smoking in the country are falling following a series of annual hikes on the rate of tax applied to tobacco products.

Since the implementation of an annual hike of 10 percent on the sale of tobacco products, the consumption per adult fell by approximately 6.3 percent per year, cumulatively resulting in a 23 percent decline in consumption between 2010 and 2014.

It was noted that as the consumption of cigarettes fell, the proportion of sales between brands was also shifted, with comparatively cheaper products becoming more popular.

While the taxes seemed to be having the intended effect of reducing tobacco consumption, it was still noted that the sheer number of cigarettes sold in the country is very high, and that the tax hikes will need to be continued in order to ensure that the government meets its goal of eradicating smoking in New Zealand by 2025.

Photo By: jenny downing