A report has suggested that treasury is suggesting a tobacco control strategy instead of excise tax increases. This was revealed when plans to cut smoking rates were being discussed. The Government had announced tax increases, starting at 10% for factory-rolled cigarettes in April. It has planned two more hikes in the coming two years.
But a report obtained by The New Zealand Herald under the Official Information Act revealed that Treasury recommended to the Government that it should try to devise a tobacco control strategy rather than increasing tax rates.
It was argued that excise rate hikes were not effective. This is despite information from the World Health Organization that excise rate hike is the most effective way of reducing smoking rates.
Health experts also argue that it is better to increase excise rates to discourage smokers. The Government expects that the steps announced already will lead to less tobacco usage, 40,000 less smokers apart from preventing 300 smoking-related deaths every year by 2021.
The policy is also under a lot of criticism from opposition and health experts. They stress that Government needs to review its policies and how it wants to deal with smoking related problems.
It is also pointed out that since tax on loose tobacco products was not increased, smokers still continue to buy loose tobacco as it is cheaper compared to factory-made products.