Government hits the poorest with new tax

A nasty sting in the tail of upcoming tobacco tax increases will hit veterans, superannuitants, caregivers, working parents and anyone else who receives a benefit or allowance from the Government harder than everyone else, Labour’s Associate Health Spokesperson Iain Lees-Galloway says.

“A suite of bills related to the tobacco tax increase include changes to the way cost price indexing is calculated in order to ensure cost increases are not offset by higher income.

“However, instead of applying those changes to all CPI calculations, the Government has chosen only to apply them to those relating to allowances, pensions and benefits.

“The result is a two-tier system where wage earners will be able to include the increase in the price of tobacco in their case for a wage rise, but people who receive pensions, allowances and benefits won’t.

“While Labour supports the Government using regular excise tax increases to help reduce the harm caused by tobacco, we cannot support the structural discrimination included in these bills.

“That means we will vote in favour of the increase but against the bills that create that discrimination.

“The move is just another example of the Government picking on people who receive Government assistance. It was quite possible to apply this change to all New Zealanders but as usual, National has singled out a small group of Kiwis for particularly draconian action.

“It’s sad, too, that the Maori Party is supporting this discrimination.

“There has always been a suspicion that National’s enthusiasm for excise tax increases had more to do with filling the hole in the Government’s revenue created by unaffordable income tax cuts rather than improving health and wellbeing.

“This spiteful little sting just reinforces that view,” said Iain Lees-Galloway.