Illegal Cigarette Crackdown in Balikpapan: Perpetrator Sentenced to 1.5 Years in Prison

Law enforcement against the circulation of illegal cigarettes has again borne fruit. Through its ruling of 22 July 2026, the panel of judges at the Balikpapan District Court sentenced the defendant HMK (48) to one year and six months in prison, having been legally and convincingly proven to have distributed excisable tobacco goods (BKC HT) without excise stamps.

In its ruling, the panel of judges also imposed a fine of twice the excise value, namely Rp 309,636,800. The ruling follows up on the crackdown by Balikpapan Customs and Excise on the circulation of illegal cigarettes in January 2026.

The case began with a tip-off from the public regarding the suspected unloading of illegal cigarettes in the area of Jalan Karang Joang KM 1, North Balikpapan. Then, on Sunday (25/1/2026), Balikpapan Customs and Excise visited the location and found two vehicles in the process of loading goods.

Officers then inspected the two vehicles. From the inspection of one vehicle, they found 6,400 packs, or 128,000 sticks, of machine-made kretek cigarettes (SKM) of the SMITH brand, as well as 1,600 packs, or 32,000 sticks, of SKM of the MARBOL brand, none of which bore excise stamps.

All of the goods were plain cigarettes whose circulation violated excise regulations. Following the discovery, Balikpapan Customs and Excise seized the evidence along with the transport vehicles used.

The vehicles, the evidence, and the parties involved were taken to the Balikpapan Customs and Excise Office to undergo investigation in accordance with the prevailing laws and regulations.

During the trial, the panel of judges found the defendant guilty of violating Article 54 of Law Number 39 of 2007 on the Amendment to Law Number 11 of 1995 on Excise, as amended several times, most recently by Law Number 7 of 2021 on the Harmonisation of Tax Regulations, in conjunction with Annex I of Law Number 1 of 2026 on the Adjustment of Criminal Penalties and other related prevailing laws and regulations.

The panel of judges also ordered the evidence, comprising 128,000 SMITH brand cigarettes and 32,000 MARBOL brand cigarettes without excise stamps, to be confiscated for destruction by the state.

Meanwhile, one vehicle along with its documents was returned to a witness. The mobile telephone, driving licence, debit card, and bank statement belonging to the defendant were returned to the relevant party in accordance with the ruling.

The Head of the Counselling and Information Services Section at Balikpapan Customs and Excise, Tirta, said the ruling demonstrates the seriousness of law enforcement officials in taking action against perpetrators of illegal cigarette distribution. The ruling is proof that circulating illegal cigarettes carries serious legal consequences.

“In addition to reducing state revenue from the excise sector, illegal cigarettes create unhealthy business competition and harm business operators who have complied with the prevailing laws and regulations,” said Tirta in a statement on Monday (3/8/2026).