What is excise?

Excise is a form of tax

Excise is a duty imposed on domestically manufactured tobacco, fuel and alcohol.

If you make, sell or give away excisable items – alcohol, fuel and tobacco products – in New Zealand, we’ll charge excise duty on those products. You must also licence the areas (Customs-controlled areas) where those products are made and stored.

When excisable items are imported, duty is imposed (excise-equivalent duty) which is equivalent to the excise liability that would apply if the goods were manufactured in New Zealand. Goods for export are not subject to excise.

Note: this is an overview. For full detail, please refer to the legislation.

• Customs and Excise Act 2018 
• Customs and Excise Regulations 1996
• Customs (Application for Customs-controlled Area Licenses) Rules 2014 (PDF 298 KB) 
  
• Customs (Applications for Customs-controlled Area Licences) Rules 2018  (PDF 2.6 MB)
  
• Customs (Excisable Goods Entry) Rules 1997 (PDF 182 KB)
• Customs Excisable Goods Entry Amendment Rules 2018 (PDF 249 KB) 
• Customs (Volume of alcohol) 2013 (PDF 49 KB).

Excise duty

Excise duty is generally payable on anything removed from or consumed in the licensed area, including:

• tasting samples
• promotional give-aways
• donations
• free supplies
• bonus supplies.

The Excise and excise-equivalent Duties Table (PDF, 283 KB) lists those goods that are subject to the excise regime and sets the rates of excise and excise-equivalent duty payable.

Fuel

You must be licensed to manufacture fuel, and this includes additional manufacture i.e. the blending of duty-paid fuel with other substances, which results in an additional volume of fuel. Regulations prescribe a formula for calculating the volume of new fuel on which excise is levied. 

Excise duty exemptions

We won’t charge excise duty on excisable items if they’re:

• exported immediately after they leave the manufacturing area
• moved to an export warehouse that you’ve licensed with us
• removed temporarily for a manufacturing process, and returned to the manufacturing area
• legitimate manufacturing samples, eg for laboratory/quality control testing
• received, used, or supplied under the authorisation of a duty-free alcohol permit.

If you’re making alcohol, tobacco or fuel products for your personal use:

• you don’t need to license your manufacturing area
• we won’t charge you excise duty.

If you share those products with anyone else, for free or as a sale, you become liable for excise duty.  The criteria is outlined in section 67 of the the Customs and Excise Act 2018.