In a controversial move, the National-NZ First coalition government has formally extended a 50 percent excise tax reduction on Heated Tobacco Products (HTPs); commonly marketed devices like IQOS—well beyond its originally stated one‑year trial, with the evaluation now deferred until July 2027.

Originally rolled out in July 2024, the tax cut was pitched as a way to encourage smokers to switch to supposedly less harmful alternatives. However, health officials had warned there was no credible evidence that HTPs support quitting or are significantly safer than conventional cigarettes. Treasury projected the policy could cost the Crown up to NZ$293 million by 2029, with most benefits likely accruing to Philip Morris, the sole major supplier in New Zealand. 

The government’s decision to prolong the measure has drawn strong criticism from health advocates and the Labour opposition. Labour’s health spokesperson Ayesha Verrall denounced the extension as misguided, accusing the government of prioritising tobacco company profits over public health, and calling the promised evaluation “a total sham”