Don’t Over Tax Vapes, Says NZ Advocacy Group

May 14, 2018 Taxation in New Zealand

tobacco taxationWELLINGTON – As more people stop smoking, the government of New Zealand has to be careful not to discourage cessation through over taxation.

The New Zealand advocacy group, the Taxpayers’ Union, is calling on the government to ensure that it does not resort to taxing tobacco alternatives such as vapes or HEETS.

It has been estimated that the growing popularity of tobacco alternatives in New Zealand will lead to a tax gap of NZD 1.8 billion, as fewer people purchase cigarettes and loose tobacco.

Introducing a tax on vape liquids and similar products could reduce the incentive for smokers to choose healthier options, and “would perpetuate a major cause of financial harm for some of the poorest New Zealanders.”

The Taxpayers’ Union spokesman Louis Houlbrooke said that “some lost tax revenue is a small price to pay for thousands of lives saved by these technologies.”

The New Zealand government has set forward a goal to reduce the smoking rate in the country to less than 5 percent by the year 2025.