• John Luxton
Commerce and Industry

Tariffs on motor vehicles will be an immediate focus for Government, meaning even cheaper cars for all New Zealanders, Minister of Commerce John Luxton said today.

"The costs from motor vehicle tariffs are dramatic. Consumers and business are paying in excess of $300 million per year in motor vechicle tariffs. That works out at around $180,000 per job in the assembly industry.

"A motor vehicle that has an import value of $12,000 currently attracts a tariff of $3000. This protection means people are paying more for locally produced vechicles.

"The motor vehicle assembly industry has asked for an early review of the tariff regime to apply post 2000. We have agreed to this, and will be making decisions on these future motor vehicle tariffs by the end of this year.

"The current regime will lower motor vehicle tariffs from the current 25% to 15% by 1 July 2000. The Government expects that the review may result in a swift move to zero tariffs soon after. This will mean even cheaper cars for all New Zealanders."


The Government has undertaken a number of bold actions to lower the costs faced by businesses and exporters in particular. Paramount amongst these is a commitment to remove all remaining tariffs. The specific timing of the move to zero tariffs will be determined in a tariff review to be completed during 1998.

"Removing tariffs is one of the most important initiatives we can take to reduce costs and benefit New Zealand consumers by providing access to cheaper products.

"Our strong intention is that all tariffs will be removed well within our APEC commitment to free trade and investment by 2010."

In making its decisions on tariffs the Government will take into account the progress of its trading partners. This has been set out in the Coalition Agreement.

"However, this does not mean that New Zealand will be taking a wait and see approach," Mr Luxton stated.

"The trend globally and regionally is one of rapid trade liberalisation. The Government intends for New Zealand to be a leader, rather than a follower, in this process," Mr Luxton concluded.