Indonesia raises the excise tax on tobacco products by an average of 12.5 per cent in 2021, reports Reuters.
The government has been raising taxes on tobacco products almost every year since 2014, but WHO data shows that the smoking prevalence among adolescents aged 10 to 19 years had increased by about 20 per cent in a five year period to 2018, while the adult prevalence had not declined. About 70 per cent of adult men use tobacco products in Indonesia, according to the World Health Organization (WHO), one of the highest rates in the world, with cigarette prices also among the lowest of any country, the report said.
The new excise policy, whichcomes into effect on 1 Feb, aims to reduce the smoking prevalence among youths from the current 9.1 per cent to 8.7 per cent in 2024, Minister Sri Mulyani Indrawati said. “The excise hike will make cigarette prices more expensive … so they’re less affordable,” she was quoted as saying. However, she said the tax hike would not affect hand-rolled clove cigarette producers, which are dominated by small- and medium-sized enterprises.