The Ministry of Finance plans to raise cigarette taxes by up to 12 per cent in 2022 to increase government revenue and curb smoking, especially among children, The Star reports.

The ministry said on 13 December that it would raise excise duties on machine-made clove cigarettes (SKM) and white cigarettes (SPM) by an average of 12 per cent. For hand-rolled cigarettes (SKT), which are manufactured using labour-intensive processes, the government will cap the increase at 4.5 per cent.
“Excise tax is an instrument to control [consumption] in line with the excise tax law,” Finance Minister Sri Mulyani Indrawati said in a press briefing.
The government has increased tobacco excises every year since 2014 to reduce smoking among children and teens between 10 and 18 years to 8.7 per cent by 2024. In 2021, the excise duty was increased by 12.5 per cent.
The latest increase is expected to reduce smoking prevalence from an estimated 9 per cent this year to 8.83 per cent in, according to Sri Mulyani.
The government also raised the price floor for cigarettes in all categories, resulting in significantly higher retail prices. For example, the price floor for the SPM I category, will increase by 12.01 per cent annually to IDR 40,100 (USD 2.8) for a 20-cigarette pack in 2022, the report said.