The Jakarta Regional Office of Customs and Excise has launched an\n\u2018illegal cigarette crackdown\u2019 movement, following the impact of their\ncirculation which has begun to suppress regional original revenue (PAD)\nand destabilise the growth of the legal tobacco industry (IHT).<\/p>\n
The Head of the Jakarta Customs Regional Office, Hendi Darnadi,\nstated that the circulation of illegal cigarettes, particularly in\nJakarta, is not only eroding state fiscal revenue but also suppressing\nregional original revenue in the form of tobacco taxes and creating\nunfair business competition.<\/p>\n
\u201cWe also hope and invite the community and business actors to work\ntogether in supporting the \u2018illegal cigarette crackdown\u2019 movement. Do\nnot buy, sell, store, distribute, or consume illegal cigarettes,\u201d said\nHendri, as quoted from a written statement following a press conference\non illegal cigarette enforcement.<\/p>\n
Hendri noted that recent enforcement actions against illegal\nexcisable goods by the Jakarta Customs Regional Office and the Marunda\nCustoms Office reached 10,067,000 illegal cigarettes. This was obtained\nfrom three enforcement operations between 31 August and 1 September\n2026, with an estimated potential loss to the state of\nRp7,510,429,600.<\/p>\n
The Marunda Customs Office also received 716,800 illegal cigarettes,\npacked in 45 packages, handed over by the West Jakarta Metro Police. The\npotential loss to state excise from this seizure is Rp534,732,800.<\/p>\n
Consequently, the total amount of seized illegal cigarettes stands at\n10,783,800 sticks, with an estimated potential loss to the state\nreaching Rp8,045,162,400.<\/p>\n
Throughout 2026, the Jakarta Customs Regional Office has conducted\nenforcement against illegal cigarettes totaling 59.8 million sticks,\nwith a potential loss to state excise of Rp46.79 billion. This figure\nrepresents an increase of approximately 257% compared to the same period\nin 2025, which stood at 23 million sticks.<\/p>\n
During the same event, the Secretary of the Directorate General of\nAgro-Industry of the Ministry of Industry, Yulia Astuti, stated that the\ncirculation of illegal cigarettes has proven to harm the legal tobacco\nindustry (IHT) and its entire ecosystem, from upstream to\ndownstream.<\/p>\n
According to her, the prevalence of illegal cigarettes continues to\nerode the performance of the tobacco industry. Based on Ministry of\nIndustry records, domestic cigarette production has declined by\napproximately 3%.<\/p>\n
This decline is also reflected in the performance of the IHT sector.\nThe Gross Domestic Product (GDP) growth of the tobacco industry sector,\nwhich was recorded at 3.49% in 2024, fell to -1.37%, and contracted\nfurther to -1.96% in the second quarter of 2026.<\/p>\n
\u201cIn line with this, state revenue related to tobacco excise has also\nbeen impacted. One of the reasons is the prevalence of illegal\ncigarettes recently,\u201d she explained.<\/p>\n
Yulia assessed that the pressure on the legal industry due to illegal\ncigarette circulation ultimately impacts the workforce. This condition,\nshe said, has the potential to drive industries to reduce working hours\nor days, or even implement layoffs (PHK).<\/p>\n
\u201cFor the workforce, specifically in the IHT sector and its related\nindustries, the number reaches over 6 million people,\u201d she added.<\/p>\n
From the upstream perspective, she noted that the circulation of\nillegal cigarettes has also impacted the absorption of tobacco raw\nmaterials from farmers. She mentioned that stocks of raw tobacco from\nprevious years are estimated to still be available in several tobacco\nfactories.<\/p>\n
\u201cWith the reduction in domestic cigarette production, stocks of raw\ntobacco from previous years are estimated to still be available in\ntobacco industry factories. Consequently, there is a potential reduction\nin the absorption of tobacco during harvest seasons on the upstream\nside,\u201d she said.<\/p>\n
The Deputy Head of the Jakarta Provincial Regional Revenue Agency,\nElvarinsa, added that cigarette circulation is a significant contributor\nto regional original revenue through tobacco tax levies.<\/p>\n
For this year, he stated that the Jakarta Provincial Government\ntargets tobacco tax revenue of Rp1.1 trillion, but as of August 2026,\nonly Rp444 billion has been collected. This indicates the significant\npressure caused by illegal cigarette circulation.<\/p>\n
\u201cFor the 2026 period up to August, we are experiencing a decline in\ntobacco tax revenue. Last year, it was Rp521 billion as of August 2025,\nbut for August 2026, it is at Rp444 billion. This means there is a\ndecline,\u201d Elvarinsa revealed.<\/p>\n
He expressed hope that strengthened enforcement against illegal\ncigarettes would help drive an increase in regional revenue,\nparticularly in the tobacco tax sector.<\/p>\n
\u201cHopefully, with these enforcement actions, we can increase our\nrevenue, especially regional original revenue, specifically from tobacco\ntaxes,\u201d Elvarinsa emphasised.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/causing-decline-in-regional-revenue-and-industry-collapse-customs-to-crack-down-on-illegal-cigarettes-1788998116", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }