Salesa JennyThird ReadingHon JENNY SALESA (Minister of Customs): I move That the Customs and Excise (Tobacco) Amendment Bill be now read a third time. I'm pleased to come to the third reading of the Customs and Excise (Tobacco) Amendment Bill. This bill directly responds to a rapidly growing threat facing New Zealand. The smuggling and unlicensed manufacture of tobacco products is putting at risk approximately $2 billion a year of Crown revenue and the health of many New Zealanders. The excise tax on cigarettes and other tobacco products has been a key tool in reducing the number of New Zealanders who smoke and to save lives by reducing smoking rates has been a goal of all Governments over the last 10 years. As we all know smoking has a direct link to lung cancer which is a hideous disease that destroys too many of our loved ones. Smoking is also a serious risk factor in a number of chronic diseases. We as a country can neither afford the pain it afflicts nor the economic cost. Smuggled and illicitly manufactured tobacco evades excise tax. Not only does this reduce Crown revenue but it also affects the way that Government provides services. Further smuggled and illicit manufactured tobacco may not meet the Government's plain packaging requirements or carry health warnings. And all of this encourages more smoking directly undermining our goal for Smokefree 2025. As I set out in my first reading speech tobacco smuggling is currently low risk and highly profitable thus feeding and strengthening the organised criminal groups involved. I am resolved to minimise the involvement of organised crime in the New Zealand economy and society generally. This is another reason why I'm determined to see this bill passed as quickly as possible. This bill will impose import controls and give customs streamlined processes designed to address the very particular nature of tobacco smuggling especially through the mail. The provisions in this bill will still enable legitimate imports of tobacco in all of its forms but it will require importers to get a permit and ban importation through the postal mail system. A permit system will allow customs to undertake due diligence on tobacco importers. Preventing import in the mail is vital to combating tobacco smuggling. Criminal groups are well aware that the mail system aids anonymity and that customs does not receive information on mail parcels prior to import as it does for other imports. Now I'm not expecting that smugglers will stop sending hidden and mis-described tobacco through the mail just because we introduce a permit system. That is why the bill also provides for a bespoke seizure and destruction process to apply to tobacco that will inevitably still be sent through the mail. That process will only apply to tobacco and tobacco leaf which will reduce storage time and costs. This will also free up customs staffing resources to focus on protecting New Zealand from other dangerous or illegal imports like meth and other illicit drugs and offensive weapons. But preventing smuggling and the illegal manufacture of excise tobacco is only part of the story. We need to do this while also protecting the right to trade and manufacture without incurring undue costs or barriers. This bill achieves both objectives without needing to make any free trade-offs. People will still be able to legitimately import tobacco through fast freight courier systems as bulk sea cargo. Permits will be free and the process for getting one will be simple. Existing legitimate importers will be issued their first permit automatically for the period of a year or until their manufacturing licence needs to be renewed. No one buying legitimate product will notice any change as the permit system will have no impact on the availability or the price of legitimate tobacco product. International travellers when such travel once again becomes possible will experience no change either. The current duty-free tobacco allowance will continue as it is.I hope that as I've shepherded this bill through the House I've been able to convey the absolute urgent need for new tobacco specific input controls and a new tobacco seizure and destruction process. As I mentioned in my first reading speech with this bill having highlighted how tobacco imports are undermining the system it is very important to take urgent and swift action so that there is limited opportunity for it to get worse especially in relation to tobacco leaf because even during alert levels 4 and 3 tobacco smuggling has continued.The combination of excise and revenue evasion involved with organised crime money-laundering and circumventing the smoke-free controls makes urgent action necessary. Without this change I fear that the gains New Zealand has made in battling tobacco addiction and chronic disease will be lost and organised crime will gain a profitable economic base from which they can expand their activities. I am sure that you share my determination to see that this is addressed.I commend this bill and its final reading to the House. Thank you Madam Speaker.