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Indonesia raises tobacco tax

Time: 2022-12-14

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Indonesia increases tobacco tax: e-cigarettes will increase by 15%, other tobacco will increase by 6% per year

The Indonesian government plans to increase the tobacco excise tax rate on roll-your-own cigarettes by 10% in 2023 and 2024, capped at a maximum annual increase of 5%, Antara reported.


In the next five years, the consumption tax rate of various electronic cigarettes will increase by 15%, and the consumption tax rate of other tobacco products will increase by 6% every year.


The minimum retail prices of tobacco products have been adjusted to take into account changes in market prices and average increases in excise duties on cigarettes.


The goal of tax increases is to reduce smoking and tobacco use among the population.


Finance Minister Sri Mulyani Indrawati said at a working meeting with the Eleventh Committee of the Indonesian House of Representatives: "With excise tax as a fiscal tool to control consumption, we hope that excise tax will increase prices and thus reduce the number of smokers.


Indonesia currently ranks first in the world in terms of prevalence of adult male smokers and fifth in the world for adult smokers.



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