31 Dec 2019

Tobacco tax hike prompts fear among dairy owners

5:22 pm on 31 December 2019

Dairy owners want the government to step in and help fund increased security as another tobacco price rise comes into effect.

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Photo: 123RF

An automatic 11.46 percent increase will go ahead on New Year's Day 2020, the last of four consecutive excise hikes put in place by the former National Party government.

Crime Prevention Group president Sunny Kaushal said aggravated robberies were on the rise because tobacco was so expensive.

"This has been a continuing as issue as the government increases the tax year after year and it's not the solution to deter people from smoking, in fact it's doing more damage.

"Some of the consumers who cannot afford tobacco are indulging in the black market and the black market is driven by criminals and that includes violence on dairies and shops."

The group represents most dairy owners throughout the country. Kaushal said shop owners needed government help to protect themselves.

"The government is collecting over $2 billion in tobacco taxes but is not even spending a fraction of it [on safety]."

The former National Party government set aside $1.8 million in June 2017 that shop owners could apply for if they wanted to install safety systems like alarms, fog cannons and safes.

Kaushal said that fund was a good start but it needed to be topped up.

"About 400 or 500 dairies or shops got assistance but then the fund finished and I've been asking the current government, what are the next plans. We have over 3000 dairies and we desperately need those funds.

"Dairy owners are not rich people, they are hardly making minimum wage. They cannot spend money protecting their shops and putting in expensive equipment. The government needs to come in because they are collecting the GST and the tax and so it's also the government's responsibility to make sure our businesses and communities are safer."

Price hikes affecting the vulnerable

Independent researcher Marewa Glover said the price hikes were disproportionately affecting vulnerable members of society and they needed to stop.

"What we need to be looking at is the very high smoking rates among vulnerable groups. The lower socio-economic, the poorest people have disproportionately high smoking rates, mental health consumers and Māori still have this huge inequity in smoking rates compared to non-Māori, non-Pacific people.

"So, these particular groups, the most vulnerable with the highest smoking rates are paying way more than they can now afford."

She said high prices had proven a lot of people wouldn't quit even if they could not afford it.

"If anything, I believe, it's driving financial stress, causing extra strain and that becomes a driver to smoke. So the policy that was supposed to get people to stop smoking is actually driving people to smoke."

She said attacks on dairy owners in aggravated robberies was another unintended consequence of the policy - which she had initially supported.

"It's been like the wild wild west here in New Zealand with aggravated robberies and serious harm being done to some shopkeepers. You know, one man lost an eye and another was slashed down their arm with a machete. So these are very, very serious crimes and it's because of the tax increase - cigarettes are now like gold."

Glover said it would be better to encourage people to make the move to alternatives like vaping, instead of any more prices hikes.

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