According to the latest news, New Zealand will follow Australia in reducing the duty-free cigarette allowance.
Tariana Turia, Associate Health Minister, declared that she intends to cut duty-free cigarette allowance.
Starting with September 1, the allowance for bringing in tobacco in Australia has been significantly reduced. The previous duty-free cigarette allowance was 250 cigarettes or 250 grams of cigars. The new limit was decided to become 50 cigarettes (about two packs) or 50 grams of cigars. The new rule does not just regard to cigarettes bought duty-free, but any tobacco acquired.
The new measure could join the Government tens of millions of dollars in extra taxes every year.
As the cigarette pack price cigarettes increases, the appeal of duty-free has become stronger.
Tariana Turia said that the people who buy cigarettes in duty-free stores provide them for friends or resell them.
The introduction of the reduced allowance in Australia was held last weekend, disappointing some Aussies at Queenstown Airport who’d hoped to lay in cigarettes on their way home.
A person told to media that he is disappointed as he was waiting all holidays to buy cigarettes and not only two packs as it is allowed now. Another said that a guy like he, who has been smoking for a long time, needs 200 cigarettes, but added that it is good for children to keep them off the cigarettes. He added that he totally agree with the new measure.
If New Zealand follows Australia in reducing the duty-free cigarette allowance, it could bring in more than $50 million in taxes every year.
Today duty-free cigarettes make up 5 percent of sales.
In the context of discouraging people from smoking, the reduction of the duty-free cigarette allowance is a good thing.
The current excise rate for cigarettes is about 35 cents a stick. On a carton of 250 cigarettes, that would amount to a saving of around $87.50. On 50 cigarettes, it’s a more measly $17.50.
Mr Wilson said that they should follow Australia’s lead on this issue, but to do better and go down the road Singapore has and eliminate duty-free sales totally.
This latest measure would further punish the cigarette makers, who are in the midst of an expensive advertising campaign to bloke plain packaging for their products.