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Tobacco tax hike: It’s all about the money Cash cow

#1 User is offline   REX 

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Posted 31 May 2016 - 12:20 PM




http://www.taxpayers.../passive_income

Tobacco tax hike: It’s all about the money

[images removed]
January 01, 2016 New Zealand Taxpayers' Union

Over the last 12 months we’ve had a number of members who smoke ask us to examine the issue of tobacco taxes. So to coincide with today’s 10% hike in tobacco excise we’ve released a report examining the issue.

Smokers have become the political punching bag over the decade with the current Government hiking excise taxes nearly every year under the guise of health concerns and to pressure low income New Zealanders to give up the habit.

Our members who smoke often feel as though they are treated as cash cows. Our research shows that their concerns are justified, with government tobacco excise income around three times the estimated cost of smoking to our health system.

The report details the effect of tobacco excise increases, the failure of the Government to legalise the sale of healthier alternatives which would minimise harm, and the misuse of taxpayers' money given to not-for-profits which lobby the government.

Politicians claim higher tobacco taxes are necessary to promote better health, but the Government has prevented the sale of new generation smoking alternatives such as e-cigarettes which are 95% less harmful and are the most popular smoking cessation tool used in England.

While politicians cry crocodile tears about the harms of smoking, they are refusing to allow the sale of healthier alternatives. It appears the only reason is to protect the revenue stream from the taxes on traditional cigarettes.

From today, a $20 20-pack of cigarettes includes nearly $16 dollars of tax



It makes a complete mockery of the National Party’s election promise not to increase taxes.

Increases in tobacco excise tax are often held up as interventions that are effective at reducing consumption amongst low socio-economic groups. However, significant tax increases have coincided with an increase in the socio-economic smoking gradient. Counterintuitively, the poor are the least likely to respond to tax hikes. That means they, and their families, go without.

Just because a consumer base is poor, it does not mean that the Government is any more justified in making consumer health choices for them. Worse, increasing taxes well in excess of the health costs of tobacco, knowing that they are being paid by those least able to afford it, is morally questionable.



Even anti-smoking group ASH’s own expert estimates that tobacco excise tax is around three times the actual costs to the public health system caused by smoking (and that was before today's tax hike).

The report also examines the work of ’sock puppet’ lobby groups – those which are funded by the government to lobby the Government.

Every year the Ministry of Health waste tens of millions of dollars on tobacco groups that aren’t actually helping smokers quit. Instead they’re running political campaigns to lobby the government for higher taxes and more controls.

Take ASH for example. Here is a group which is 95% taxpayer funded which openly works with the Maori Party to lobby the Government for higher taxes and more tobacco controls. If the shoe was on the other foot and the Government was funding property groups to campaign for RMA reform, the Maori Party would be justifiably outraged. This is no different.

Every dollar wasted on taxpayer funded political campaigns is one less for frontline health services.




Q&A
Why a report on tobacco tax?

Tobacco excise taxes increase by 10% on 1 January 2016. Tobacco duties and excise tax revenue, which has increased by almost $450 million since 2009, now accounts for about 1.4% of total government revenue.

How much of the retail price of tobacco is tax?

As of 1 January 2016, excise tax accounts for around 66 cents per cigarette. For a 20-pack of cigarettes which may retail for $20, excise tax accounts for $13.33. After adding the 15% GST to the total, it means for every $20 20-pack of cigarettes, the government takes $15.94.

What are the report’s key findings?

The report details tobacco control measures since the 1980s and shows:



  • Smokers are paying more in tax than ever before, with almost $16 of combined excise tax and GST per $20 20-packet of cigarettes
  • Tobacco excise and duties now account for 1.4% of government revenue
  • E-cigarettes have been found to be 95% healthier than traditional smoking and are the most popular smoking cessation tool in England but remain illegal to sell in New Zealand
  • The Ministry of Health is funding 'sock puppet' political campaign groups that use taxpayer money to lobby the Government
What are the report’s recommendations?

  • A moratorium on tobacco tax increases until reviews can be undertaken on:
    • the risks of an Australian style illicit tobacco problem developing in New Zealand; and
    • the potential harm reduction in lifting New Zealand’s blanket ban on the sale of e-cigarettes and other new generation tobacco products.
  • An independent review of Ministry of Health funding of tobacco lobby groups to ensure that taxpayers are receiving value for money.
  • Extending the Official Information Act to cover those not for profit organisations which are majority taxpayer funded.

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#2 User is offline   REX 

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Posted 31 May 2016 - 12:29 PM

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Every dollar wasted on taxpayer funded political campaigns is one less for frontline health services.


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#3 User is offline   REX 

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Posted 31 May 2016 - 12:43 PM

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#4 User is offline   REX 

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Posted 31 May 2016 - 12:45 PM

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#5 User is offline   tommy 

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Posted 31 May 2016 - 05:16 PM

smoke more cigs or dont smoke at all , there will always be monies to be had out of addictions nothing has changed
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#6 User is offline   REX 

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Posted 31 May 2016 - 08:43 PM

View Posttommy, on 31 May 2016 - 05:16 PM, said:

smoke more cigs or dont smoke at all , there will always be monies to be had out of addictions nothing has changed


Hi Tomthumb :D/>

I just want to use your attention here to highlight what other members or readers may NOT have understood as to what has been discovered/established


If you recall the thread Kiwisaver where as I mentioned the worthy friends with "charities".. This articles examination of finances analysis, shows another example what I was talking about for misuse of our money big time. ;)/>

The government charge smokers all this EXCISE tax for what's SAID just to cover the health issues caused by the smoking, so it isn't a drain on the tax payer funds..


and it has HUGE surplus,, !!!!!!! Millions and Millions.

Quote

Our members who smoke often feel as though they are treated as cash cows. Our research shows that their concerns are justified, with government tobacco excise income around three times the estimated cost of smoking to our health system.


Then they "apparently" give it to worthy "Non profit health charity"

The union has established health lobby sock puppets,, so the money we pay is going around and around in their own circles and more than likely being claimed back to these entities as they are non profit...

It should be set aside to lower levies, Home owners rates and/or government health charges for say doctors apts which could then be free for the low income earner with children over 6 years old instead of it costing the parent :D/>

We are essentially getting double tax dipped by the government instead, so they can fund their own lobby agenda for the health system (which they deny E cigarette alternatives that are 95%\ less harmful )


Quote

Our members who smoke often feel as though they are treated as cash cows. Our research shows that their concerns are justified, with government tobacco excise income around three times the estimated cost of smoking to our health system.

The government uses our money that we didn't approve for surplus

Quote

The report also examines the work of ’sock puppet’ lobby groups – those which are funded by the government to lobby the Government.

They use the money for their own agenda not to help the present needs of the people who are at risk

Quote

While politicians cry crocodile tears about the harms of smoking, they are refusing to allow the sale of healthier alternatives. It appears the only reason is to protect the revenue stream from the taxes on traditional cigarettes.

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#7 User is offline   Alan Thomas 

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Posted 31 May 2016 - 09:26 PM

But does the extra tax pay for the extra health costs yet?
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#8 User is offline   REX 

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Posted 31 May 2016 - 09:34 PM

View PostAlan Thomas, on 31 May 2016 - 09:26 PM, said:

But does the extra tax pay for the extra health costs yet?





Hi Alan

The Excise Tax on cigarettes has been in place for years at a lower rate and easily creating the revenue covering the health issues related to smoking

The rate of increase is now in budget and risen for no said need = :o/>

They are using the surplus when if anything should be set aside for health issues the smokers will create for themselves in their elderly life

And due to there being a huge issue around the baby boom we have to have some sort of control over their willy nilly spending of surplus to suit personal party agendas, or what are they going to use as the cash cow next for our children to endure.
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#9 User is offline   Alan Thomas 

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Posted 31 May 2016 - 10:17 PM

The whole smoke tax should be set aside for smoker heath issue only. (like acc levies)
Tax as a punishment is a human rights issue.
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#10 User is offline   REX 

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Posted 31 May 2016 - 10:32 PM

View PostAlan Thomas, on 31 May 2016 - 10:17 PM, said:

The whole smoke tax should be set aside for smoker heath issue only. (like acc levies)
Tax as a punishment is a human rights issue.


Yes I totally agree it is a tax to create funds for specifically smoking related problem issues, No one agreed to pay three times the amount these health issues cost society.
I have tried many times to see where law allows the government to use tax hike to force the smoker to have NO choice but to give up.

It allows no economical freedom of choice as an adult.

They have clearly stated their intent and purpose behind the price hike and it involves affordability of the target group. (Lower socio economic group making up a high percentage of smokers)

I believe that is a human rights issue surrounding the smokefree agenda

With this excise smokes tax you can see how much money the low earner is supplying in the generation of this tax and this is play money for the high earners,,:(/>



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#11 User is offline   REX 

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Posted 31 May 2016 - 10:55 PM

BTW I'm not a smoker,:)/>
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#12 User is offline   Lupine 

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Posted 01 June 2016 - 07:23 AM

I have tried E Cigarettes using the nicotine based cartridges and they may not be the panacea some are hoping for. I found the delivery inconsistent and that was an issue if you are used to the consistency of smoking a normal cigarette. Another issue was the constant recharging the E version requires. Personally and I emphasis the use of the word personally, there may be some credence to arguments that the use of E Cigarettes can lead to using the real thing again pretty quickly which sadly was my experience.

I agree with what Rex is saying in that the Government's targeting of smokers is a cynical practice.
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#13 User is offline   not their victim 

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Posted 01 June 2016 - 07:54 AM

Get creative

Grow your own

4 months of stunning plants about 7 feet tall with pretty flowers

Dry the leaves

Spray or soak them in alcohol of choice for flavour

Tobacco cutters are available online

No added chemicals... And until you grow 12kg of finished product_no tax

Not an optimal solution to "not smoking" however organic has no added toxic chemicals therefore reduced number of cigarettes per day as smokers don't crave the next chemical hit..

Less health issues....

NZ has the perfect climate in some areas for tobacco production
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#14 User is offline   Lupine 

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Posted 01 June 2016 - 10:33 AM

View Postnot their victim, on 01 June 2016 - 07:54 AM, said:

Get creative

Grow your own

4 months of stunning plants about 7 feet tall with pretty flowers

Dry the leaves

Spray or soak them in alcohol of choice for flavour

Tobacco cutters are available online

No added chemicals... And until you grow 12kg of finished product_no tax

Not an optimal solution to "not smoking" however organic has no added toxic chemicals therefore reduced number of cigarettes per day as smokers don't crave the next chemical hit..

Less health issues....

NZ has the perfect climate in some areas for tobacco production


The only problem with going down that path is unprocessed tobacco has an appalling taste. All the chemicals are designed to make the unpalatable palatable.
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#15 User is offline   Brucey 

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Posted 01 June 2016 - 11:14 AM

View PostLupine, on 01 June 2016 - 10:33 AM, said:

The only problem with going down that path is unprocessed tobacco has an appalling taste. All the chemicals are designed to make the unpalatable palatable.


Unprocessed tobacco does have an appalling taste, but if you dry it and cure it properly it can be as good as the bought stuff. there is a skill involved, that must be learnt, but it is an enjoyable hobby. I have grown and processed my own when I used to smoke, There are two types available here in NZ, Havana, and Virginian, the latter produces a milder cigarette, the trick is in the drying and the curing using honey and your favourite spirit.
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#16 User is offline   Redsector 

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Posted 01 June 2016 - 04:22 PM

View PostLupine, on 01 June 2016 - 07:23 AM, said:

I have tried E Cigarettes using the nicotine based cartridges and they may not be the panacea some are hoping for. I found the delivery inconsistent and that was an issue if you are used to the consistency of smoking a normal cigarette. Another issue was the constant recharging the E version requires. Personally and I emphasis the use of the word personally, there may be some credence to arguments that the use of E Cigarettes can lead to using the real thing again pretty quickly which sadly was my experience.

I agree with what Rex is saying in that the Government's targeting of smokers is a cynical practice.


This is a common experience with some who try vaping but in the end stay with smoking. The problem is trying with substandard gear, often the cheap cig-a-likes the small thin ones with small batteries. Best to get good gear and it will generally end your days of smoking, saving heaps of money and improved health and longevity.
With correct use of suitable gear there is no reason to smoke.
Give it another try Lupine....it's worth the effort, all the best.
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#17 User is offline   Lupine 

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Posted 01 June 2016 - 06:25 PM

View PostRedsector, on 01 June 2016 - 04:22 PM, said:

This is a common experience with some who try vaping but in the end stay with smoking. The problem is trying with substandard gear, often the cheap cig-a-likes the small thin ones with small batteries. Best to get good gear and it will generally end your days of smoking, saving heaps of money and improved health and longevity.
With correct use of suitable gear there is no reason to smoke.
Give it another try Lupine....it's worth the effort, all the best.


Good advice. I will look into it. :-) Thanks.
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#18 User is offline   Lupine 

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Posted 01 June 2016 - 06:27 PM

View PostBrucey, on 01 June 2016 - 11:14 AM, said:

Unprocessed tobacco does have an appalling taste, but if you dry it and cure it properly it can be as good as the bought stuff. there is a skill involved, that must be learnt, but it is an enjoyable hobby. I have grown and processed my own when I used to smoke, There are two types available here in NZ, Havana, and Virginian, the latter produces a milder cigarette, the trick is in the drying and the curing using honey and your favourite spirit.


Makes sense. I predict that your methods will become more widely adopted as they are almost $25 a pack now. When I started (knowing I shouldn't but oh well) they cost $1.77 a pack!
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#19 User is offline   REX 

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Posted 02 June 2016 - 12:37 PM

View PostBrucey, on 01 June 2016 - 11:14 AM, said:

Unprocessed tobacco does have an appalling taste, but if you dry it and cure it properly it can be as good as the bought stuff. there is a skill involved, that must be learnt, but it is an enjoyable hobby. I have grown and processed my own when I used to smoke, There are two types available here in NZ, Havana, and Virginian, the latter produces a milder cigarette, the trick is in the drying and the curing using honey and your favourite spirit.


Cheers trademe do have the seed but I need some cropping paddocks now :D/>
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#20 User is offline   tommy 

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Posted 02 June 2016 - 04:37 PM

grows like a weed in running nutrient , ie NFT, hydoponics, but alas i believe you can not sell the item , only for yourselfs pleasure ,dam the system has you tied up again
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