What You Tax You Get More Of

Idiotic Taxation Policy

Man arrested for trying to smuggle 2.2m cigarettes in Customs' largest-ever tobacco seizure

According to NZ Herald reporter, Kim Moodie

A Malaysian national has been busted trying to smuggle more than two million cigarettes into New Zealand in Customs' largest-ever tobacco seizure.  He was arrested on Wednesday for attempting to evade $2.72m in duty and GST and trying to smuggle 2.2m cigarettes through the border.

Customs' group manager of intelligence, investigations and enforcement, Dana McDonald, said the tobacco seizure - Customs' largest ever at the border in a single shipment - was "yet another example of organised crime involvement in tobacco fraud".  Criminals will do whatever they can to make money, regardless of the commodity – it's just business for them," she said.

"With cigarette prices in New Zealand amongst the highest globally, tobacco fraud is seen as a lucrative business venture for criminals, and sadly we expect this trend to continue." [Emphasis, ours.]

The final paragraph is the "tell all".  New Zealand has amongst the highest tobacco prices in the world.  But most of the price is tax.  The idea is that higher taxes will (of course) result in higher "on the shelf prices".   Is the government short of money, we hear you ask?  Not at all.  The higher taxes-higher prices model is designed to discourage people from buying smokes, thereby driving tobacco out of NZ society.

The actual effect is quite different from that envisaged by dumb politicians.  Higher prices merely encourage people to take the risks and sneak tobacco into the New Zealand marketplace and sell it on the black market at the present tax-inflated price.  This results in huge profits to the smugglers--and plenty of ciggies to be had by anyone willing to pay the current market contraband price.

Which groups of politicians are responsible for this idiots' mess?  The Greens.  And the Maori Party.