Finance Minister Purbaya Provides Update on Cigarette Excise Tariff Rates for 2027

Jakarta – Finance Minister Purbaya Yudhi Sadewa said he has no intention of changing the tobacco excise tax rate (CHT), or the cigarette excise, in 2027. In other words, the cigarette excise rate will neither rise nor fall next year. Purbaya explained to reporters at the Ministry of Finance office in Jakarta on Tuesday that the government is currently choosing to maintain stability in the tobacco products industry while strengthening state revenue oversight from the sector.

‘(The cigarette excise rate) I’ll keep it constant, not up and not down. I want to see stability first,’ Purbaya said.

Rather than planning adjustments to the cigarette excise rate, Purbaya is focusing on digitalising oversight of the cigarette industry by installing production-counting machines at several cigarette factories. This strategy aims to determine the real potential of state revenue from the tobacco industry. In addition, the digitalisation of oversight is also intended to curb illicit cigarette activity.

The state treasurer will monitor the revenue developments after this strategy is implemented, which will form the basis for determining the direction of excise policy going forward.

‘Perhaps everything will gradually be digitalised. From that, I want to see actually what the net revenue from cigarettes is. In other words, if the illicit market can be eliminated, from that I will calculate (CHT) whether it needs to rise or fall,’ he said.

As for the performance of customs and excise revenue overall, it shows positive performance. By April 2026, customs and excise revenue stood at Rp100.6 trillion, equivalent to 29.9 per cent of the target in the APBN and rose 0.6 per cent.

Revenue from the excise side reached Rp74.8 trillion, up 2.2 per cent, driven by increased cigarette production in Q1.

Import duties collections also grew positively by 6.4 per cent to Rp16.4 trillion. The performance of import duties remains supported by LPG commodities and project needs.

Meanwhile export duties revenue contracted 17.5 per cent to Rp9.3 trillion. Although contracting, export duties performance is said to be improving in line with crude palm oil (CPO) price gains in March and April.