Former Finance Minister and former chair of the Tax Working Group, Sir Michael Cullen, has voiced his support for New Zealand First’s decision to oppose the planned increase in tobacco excise tax.
In an interview with The Weekend Collective, he said that increasing the price was no longer effective in making people stop smoking.
"The initial increase had a big effect in reducing smoker, but we seem to be getting down t the residual group of smokers who are becoming less sensitive to the price, even though they are on low income.”
His working group recommended that this year's excise should be the last.
New Zealand First invoked the Coalition clause of agree to disagree over the planned 11 and a half percent excise tax hike for January. Leader Winston Peters said tax rises have little effect on smoking, particularly among Māori and Pasifika.
He says cigarette smuggling has increased more than 350 percent since 2015 and that our prices, which are among the highest in the world, have provided an opportunity for organised crime.