An anti-smoking advocate has joined Prime Minister John Key in dismissing a Health Ministry suggestion of raising the price of a packet of cigarettes as high as $100.
An internal working paper for the ministry has floated the idea of hiking the price of a pack of 20 cigarettes every year until it reaches $100. The idea is part of a discussion paper on achieving the goal of a smokefree New Zealand by 2025.
Packs of 20 cigarettes now sell for about $16 to $17.
Prime Minister John Key said yesterday that $100 a packet sounded like "an awful lot", and might serve only to encourage a black market.
Anti-tobacco charity Ash director Ben Youdan said that, although price increases were a powerful tool in reducing sales, a hike to $100 a packet might not be realistic.
"What is more realistic is getting cigarettes up to $30 or $40 a pack in 10 or 15 years' time and having a mix in other policies around that. If you are pushing prices up to $100 a pack I think it's pretty inevitable that people would see it as an opportunity to undermine that and see it as an opportunity to sell tobacco illegally."
It was more important to support people to give up smoking, he said.
Mr Key said: "The Government unashamedly has been wanting to increase the price of cigarettes and take a number of other steps to deter people from smoking including potentially plain packaging and looking at display. It's all part of an integrated approach to deter people from wanting to smoke."
Preliminary analysis conducted by the New Zealand Institute of Economic Research showed a one-off tax increase of 60 per cent could halve the number of those who started smoking. A 30 per cent increase each year after that, combined with media coverage of the smokefree goal and health programmes, would cut the number of smokers to about 5 per cent by 2025.
Tax on tobacco has been hiked incrementally since 2010. Since then, sales of loose tobacco had dropped by 14.7 per cent and of manufactured cigarettes by 6.2 per cent, according to the ministry.
It was estimated about 650,000 New Zealanders were smokers.
- © Fairfax NZ News
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