SMOKING LESS

Dominion, Volume 36, Issue 15, 13 October 1942, Page 4

SMOKING LESS

The Civilian Population EFFECT OF HIGH DUTIES

Whether New Zealanders have been smoking less since the heavy increase in the tobacco duty early last May is a question which has been replied to by an official of the Wellington Provincial Tobacconists’ and Hairdressers’ Association. His estimate is that Smokers ‘have i educed their consumption of tobacco by 30 per cent. “In endeavouring to estimate the effects of the recent increases in duty taxation on tobacco and cigarettes in New Zealand, one has to consider the abnormal conditions existing,” he said. “A very large and increasing volume of tobacco sales is passing through channels other than tobacconist shops. By far the larger cf these avenues is the military camp canteen, whoso tobacco sales are exempted from the increased tax.

“It is not possible for us.to estimate the amount of turnover in the canteens, but the effect in the civilian group has been estimated to decrease;the volume of smoking by approximately 30 per cent. From the revenue angle the; position promises to be interesting. -AsJa stead-ily-increasing number of civilians continues to be drafted into the armed forces, the effect will be that the duty revenue of the civilian section will be greatly reduced. It would seem that the abnormal increase in duty of lOd. a tin on tobacco and 2d. a packet on cigarettes -will act as a doublt-edged sword as far as increased revenue is concerned. It will force the maximum amount of (tax exempted tobacco) sales through military cariteens; it will reduce the volume of civilian smoking by an amount nearly equal- to the amoutn of the increased duty revenue, viz., by 30 per cent. - “Speaking generally, the smoking public resent the magnitude of the increased duty on tobaccos. Discussions indicate that an increase of sd. a tin and Id. a packet on cigarettes would have been a more equitable impost on the smoking public. We know that a large number .of working men with families have had no option but -to reduce their smoking in order to keep their expenditure thereon at its previous level. Opinions expressed by our man-in-the-street customers are strongly critical of_ the extent of the duty increases. Business men generally support the view that <jo per cent, of the increased tax could more profitably have been gathered from other sources. Due to enforced adherence to the unit of profit principale, the tobacconist’s percentage of profit at the present increased prices on tobacco and cigarette sales is about 11 per cent. As the business or a tobacconist is a highly specialized one, depending to a major degree on its tobacco revenue, it must, be obvious that he is in for a very bad time.”