Customs DG: Study on new excise layer to curb illegal cigarettes still underway

Director General of Customs and Excise Djaka Budi Utama has stated that his office is still conducting a study regarding the plan to add a new layer of Tobacco Products Excise (CHT) tariffs, which aims to suppress the circulation of illegal cigarettes while maintaining industry stability. “Regarding the new excise tape to be initiated by the Minister of Finance, as of today we are still conducting a study on the possibility of a new layer for cigarettes or excise tapes,” Djaka said during a press conference in Jakarta on Tuesday. He said that Customs and Excise, as the executor of the policy, is currently awaiting a decision from Minister of Finance Purbaya Yudhi Sadewa. “We are waiting for a decision from the Minister regarding this matter. Because Customs and Excise is the executor, so whatever is decided or the policy made by the Ministry of Finance, we are ready to implement it,” he said. It was previously reported that Minister of Finance Purbaya Yudhi Sadewa has completed a proposal for adding a new excise layer for cigarettes and will soon bring it to the House of Representatives (DPR). In the proposal, Purbaya aims to bring illegal cigarette distributors into the legal system by having them pay a certain excise duty. For those who do not wish to switch to the legal system, Purbaya asserted that firm action will be taken by shutting down their illegal business operations. “Later, they will be given the opportunity to play in the legal market. If they refuse, we will shut them down,” he stressed in Jakarta last Friday (10/4). Regarding the projected revenue from the legalisation of illegal cigarettes, Purbaya was reluctant to provide a rough estimate and will give a more precise prediction after the regulation has been in effect for about two months. “If it is truly as large as people claim, the contribution will be very significant. But we will see how it goes. I do not want to guess before we see how it runs for a month or two,” said the Minister of Finance.