In a document released under the Official Information Act the idea was floated that the Government hike the price of cigarettes to $60 next year and then 10 per cent every year thereafter, making the cost of a pack $100 by 2020.
The ministry said the most effective way to do that was through raising the price of a packet of cigarettes.
However, Waikato University senior economics lecturer Dr Steve Lim said making smoking unaffordable would lead to a black market for tobacco, and hit poor families the hardest.
“People will find ways to circumvent this,” he said. “It would be reasonable to expect that underground markets would emerge for either smuggled or homegrown tobacco.”
Preventing smoking initiation among young people would be a more effective way to reduce smoking rates, and would not require such a drastic price hike.
While increasing the price to $100 a pack would have an effect on smoking rates, he said, it may not be significant.
Kevin Carroll, a smoker who owns tobacco specialist store Smokos in Hamilton, said the Government was “ganging up” on smokers, while largely ignoring problems associated with alcohol and other drugs.
“To me it seems like a bit of a dictatorship in terms of controlling people’s lives.
“The Government chooses to target tobacco unequally in terms of all of the other dangers out there and the other risks.
He also said hiking the price of cigarettes coupled with the push for plain packaging would open the door for a black market and counterfeit trading.
And anti-smoking organisations have also urged caution before embarking on any large-scale cost increases.
Anti-tobacco charity ASH director Ben Youdan said that, although price increases were a powerful tool in reducing sales, a hike to $100 a packet might not be realistic.
“What is more realistic is getting cigarettes up to $30 or $40 a pack in 10 or 15 years’ time and having a mix in other policies around that. ”
It was more important to support people to give up smoking and reduce demand that way. Tax on tobacco has been hiked incrementally since 2010.