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Increase in Cigarette Excise Tax
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Through Minister of Finance Regulation No. 147/PMK.010/2016, the government has set a 10.54 percent average increase in tobacco excise rates, effective January 1, 2017. This planned increase is lower than the 11.19 percent rate implemented in 2016.
Finance Minister Sri Mulyani stated that this excise tariff policy has calculated the minimum possible impact on all parties, including the direct effects on the industry. The increase in cigarette excise rates is based on five aspects: health, labor, tobacco farmers, the circulation of illegal cigarettes, and state revenue.
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