Cigarettes in plain packaging could be on shelves by early next year as the Government pushes ahead with Labour's support.
Prime Minister John Key signalled the announcement at his post-Cabinet news conference on Monday ahead of World Smokefree Day today.
The Government had put the idea on the backburner as it waited for the outcome of a major plain packaging lawsuit in Australia, which was eventually won by the Australian government.
It's part of a wider plan pushed by former Maori Party co-leader Dame Tariana Turia to have New Zealand smoke-free by 2025. It also follows last week's Budget, which increases taxes on tobacco by 10 percent a year until 2020.
"This is an important step in terms of encouraging New Zealanders not to smoke," said Mr Key.
"I know there are all sorts of discussions about this, but we know nothing kills you with greater predictability than smoking, so if the Government can take steps now to encourage New Zealander's not to smoke, whether it raising prices at point of sale or whether it is plain packaging, we're saving lives."
The legislation proposes using a brown-green packaging similar to those in Australia with at least 75 percent coverage on the front of mandatory health warnings.
British American Tobacco New Zealand is "strongly opposed" to the idea. In a statement, it said it hoped the Government would be "cautious" about the legislation which has "failed in Australia".
"We believe it would be wise for the Government to await the outcome of legal challenges on plain packaging by four countries at the World Trade Organization before introducing plain packaging here. Indeed that has been the Government's approach to date."
Mr Key isn't worried about a similar lawsuit here, though tobacco companies will be able to take the Government to court.
"They may well take a case against the Government, but the advice we've been getting over time is that the likelihood of them being successful is reducing."
The war on smokers is being continued around the country,, with Palmerston North aiming to be a smokefree city after putting more restrictions on smokers.
It also follows similar measures by the Hutt Valley District Council which applies in Lower Hutt.
Wellington City Council has also rolled out plans today to remove ashtrays from Civic Square, which is now smoke-free.
Mr Key says had he been asked a few years ago whether New Zealand could be smoke-free by 2025, he would have called it "ambitious".
"Is it an absolute done deal it'll happen in 2025? Maybe, maybe not, but we'll likely get to get there by 2025.
"What you're starting to see is community ownership of the view that New Zealand should go smoke-free. Even from people who smoke themselves, they're starting to say we understand the implications and the amount of people we're losing through cancer and other health implications of smoking."
Labour supports the legislation, leader Andrew Little saying he is glad the Government decided to push on with it.
The Maori Party is also happy the, saying it "hounded" the Government for years about it.
Co-leader Marama Fox says it's a show of strength to tobacco companies that New Zealand "wont' be intimidated" by threats of legal action.
Around 5000 people die each year from smoking-related illnesses.
What about e-cigarettes?
ACT Party leader David Seymour has called for e-cigarettes to be legalised.
But Mr Key and Mr Little are both unsure about the long-term effects of e-cigarettes, which are currently illegal to market as an aid to stop smoking.
Their visibility and use has been increasing as an alternative to smoking, but there is no long-term data about the effects.
"The advice I'm getting is there may be a role for e-cigarettes in terms of people transitioning away from smoking, but I think the health impacts of e-cigarettes is very unknown at this point," said Mr Key.
"We don't have enough good data to make a call on that."
Mr Little echoed the sentiments.
"Before we embrace something new that looks flash and has the letter 'e' in front of it, let's do a bit of homework and find out what the consequences actually are."