Kiwi Tax Freeze Proposal Gets Backlash

A proposal to freeze tobacco excise taxes for three years has triggered a fierce backlash in New Zealand, according to Radio New Zealand.

Associate health minister Casey Costello came under heavy political fire after she suggested temporarily halting tobacco tax increases in consideration of smokers’ socioeconomic backgrounds. Smokers tend to earn lower wages than the population at large.

Health Coalition Aotearoa co-chairperson Boyd Swinburn said such a move would make tobacco products more accessible.

“This proposal from Costello to put a three-year freeze on this inflation-adjusted excise tax is essentially meaning that tobacco is going to get relatively cheaper over the next three years, because it won’t be keeping pace with the rest of inflation,” he said.

Swinburn called on Prime Minister Christopher Luxon to take action.

“The Health Coalition is calling for [Costello] to be replaced as an associate minister of health, given all these policies she’s come out with which are really supporting the tobacco industry’s position.”

Action on Smoking and Health Director Ben Youden said the Costello’s proposal did not make much sense.

“Given the finance minister has stated last year that tobacco tax is an important revenue, it seems odd that a freeze on excise tax would be on the table.”

Asthma and Respiratory Foundation NZ chief executive Letitia Harding called Costello’s proposal “outrageous,” adding that it amounted to another win for the tobacco industry.

The current coalition government has been criticized for tobacco-friendly policies. One of the first actions upon taking power in late 2023 was to ditch the country’s controversial generational tobacco ban.