Gov’t Maintains Tobacco Products Excise Rate

By Office of Assistant to Deputy Cabinet Secretary for State Documents & Translation     Date 17 Desember 2018
Category: News
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pmkThe Indonesian Government has decided to maintain excise duty on tobacco products (HT), including cigarettes.

The provision is stipulated in Regulation of Minister of Finance Number 156/PMK.010/2018 On Amendments to Regulation of Minister of Finance Number 146/PMK.010/2017 On Tobacco Products Excise Rate.

The new Regulation was signed by Minister of Finance Sri Mulyani Indrawati on 12 December 2018.

Head of Ministry of Finance’s Communication and Information Service Bureau Nufransa Wira Sakti in a press release on Sunday (16/12) said that the Regulation stipulates the following:

  1. There is no increase of tobacco products excise rate and no increase of the minimum retail price limit.
  2. There is an additional provision related to the minimum retail selling price limit for other tobacco products (HPTL) and there is an amendment to Chapter I of General Provisions and Appendix II of Regulation of Minister of Finance Number 146/2017.

Nufransa also said that the tobacco products excise rate is stipulated by considering several aspects, namely controlling cigarette consumption, maintaining state revenues, managing labor, and eradicating illegal cigarettes.

“From 2013 to 2018, the increase of excise rate and adjustment of retail prices of tobacco products have resulted in a 2.8% decrease of tobacco production and a 10.6% increase of state revenues,” Nufransa added.

He went on to say that the Government also provides room for labor-intensive industries by maintaining the sustainability of employment rate. According to him, the Government will put a lot of effort into eradicating the circulation of illegal cigarettes to achieve the target of tobacco excise duty in 2019.

“(The policy) aims to make sure that legal tobacco products industry can grow and penetrate illegal market in order to increase state revenues as well as to maintain sustainability of the employment,” Nufransa said.

Nufransa further said that the Government would intensify collection of excise duty of Other Tobacco Products (HPTL) that has contributed Rp154.1 billion to state revenue in the last three months.

The Government regards the policy of tobacco excise duty in 2018 is effective, based on several parameters such as consumption control, labor, industry, illegal cigarette circulation and state revenues, Nufransa said, adding that the Government always pays attention to different interests of various parties in making the excise policy. (Biro Komunikasi dan Layanan Informasi Kemenkeu/ES)


Translated by: Ridwan Ibadurrohman
Edited by: Ersan Pamungkas

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