New Zealand increases cigarette price from $20 to $30 to discourage smokers

A pack of 20 cigarettes will increase from about $20 now to around $30 in 2020 after hefty new excise increases were announced as part of the New Zealand 2016 budget.


The tax on tobacco will rise by 10 per cent on January 1 each year for the next four years.
That is expected to bring in an extra $425 million in tax over that period.

It will affect the some 15 per cent of adult New Zealanders who smoke each day - about 550,000 people.

Today's tax hikes are part of measures designed to make New Zealand smoke-free by 2025.

The country's Associate Health Minister Peseta Sam Lotu-Iiga said raising tobacco tax was the most powerful tool to bring down rates of smoking.

Asked after his Budget address if the tax was more about revenue gathering, Finance Minister Bill English said the evidence was that tax hikes would bring down the number of smokers.

He said some people may feel targeted, but the tax hikes sent a "clear and consistent" message that, in the long-run, New Zealand was committed to drastically bringing down smoking rates.


The Heart Foundation supports the new series of 10 per cent increases, which follow several years of the same annual medicine, but says the new measure would be much more effective if it was far bigger, so the increase is too small.

"Smokers already pay more than three times the health costs of their habit. Penalising people for voluntarily choosing a damaging habit is morally questionable when the very people who pay are those who can least afford it. But governments always 'need' more money and public health is a convenient excuse."

"The socioeconomic make-up of tobacco consumers means that these higher taxes land on those who can least afford it. It means the Budget is giving with one hand but taking with the other."

He said that if the Government was genuine about reducing smoking - and not also being influenced by the extra tax revenue - why had it not legalised electronic cigarettes, which England's public health agency estimated were at least 90 per cent less harmful than smoking and were Britain's leading quit-smoking tool.

- NZ Herald