HEALTH WITH ECONOMY: EXPERTS WELCOME GOVERNMENT TOBACCO TAX HIKE IN INDONESIA

Sun 13 December 2020:

Indonesia to raise the excise tax on tobacco products by an average of 12.5% in 2021, the country’s finance minister said on Thursday, citing a need to balance efforts to control smoking with the need to support an industry that is a major employer.

The decision to increase its excise tax on tobacco products is a welcomed move, according to a public health group as Indonesia’s smoking rate among highest in the world

But the Tobacco Control Support Center and the Association of Indonesian Public Health Experts (TCSC-IAKMI) said there was still room for more measures to discourage smoking in the country.

The statement came on Friday, a day after Sri Mulyani, Indonesia’s finance minister, announced a 12.5% increase in tobacco excise tax, which will be effective starting February 2021.

She said the income target from tobacco excise tax for 2021 has been set at 173.78 trillion rupiah ($12.3 billion).

Sumarjati Arjoso, the chairperson of TCSC-IAKMI, said the tax hike was not enough to cut smoking prevalence in the country, especially among children and women.

“Smoking can only be reduced by increasing cigarette excise tax up to 25%, raising the retail price by 57%, and banning the sales of single cigarettes,” she said.

She also expressed regret over the cancellation of the government’s excise simplification policy.

According to Arjoso, simplifying the structure of tobacco excise taxes would have been the ideal instrument to increase state income and curb cigarette consumption.

Ede Surya Darmawan, the chairperson of IAKMI, stressed that the government must prioritize public health to achieve the targets set in the 2020-24 National Medium‐Term Development Plan.

According to the World Health Organization, Indonesia’s smoking prevalence stands at 29%, lower only than China and India.

A 2018 Basic Health Survey revealed that 33.8% of people aged 15 and above were smokers, the highest rate in the world.

Smoking prevalence among men was 62.9% and 4.8% among women.

The number of smokers between the ages of 10 and 18 increased from 7.2% in 2013 to 9.1% in 2018.

“This is mostly because single cigarettes are sold as cheaply as 14 cents each,” said Darmawan.

“Indonesia’s laws state that cigarettes can only be sold to and consumed by adults aged 18 and above, but there are no penalties for retailers who sell them to youngsters.”

About 70% of adult men use tobacco products in Indonesia, according to the World Health Organization (WHO), one of the highest rates globally, with cigarette prices also among the lowest of any country.

The WHO said every year around 225,700 people in Indonesia die from smoking or tobacco-related diseases.

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