The minimum driving age will be raised to 16 in August after legislation was passed unanimously by Parliament on Thursday.
The Land Transport Amendment Bill is aimed at reducing the harm caused by young drivers and repeat drink-drivers.
The bill introduces a zero-alcohol limit for people aged under 20 and toughens requirements for restricted licences.
It targets repeat drink-drivers by introducing zero-alcohol limits for three years and enabling courts to place a car inter-lock on steering wheels.
The bill doubles prison time for drunk, drugged or reckless drivers.
Transport Minister Steven Joyce told Parliament he is confident the measures will reduce the road toll.
Despite being supported by all political parties, the bill was criticised by the Labour, Green and Maori parties for failing to reduce the blood-alcohol limit.