Plain Packaging and Additive Ban on Tobacco Products Will Create an Economic Tsunami
The discourse on establishing plain packaging rules and a ban on additives for conventional and electric tobacco products in Indonesia continues to provoke protests from business players, tobacco farmers, and labour unions.
Chairman of the Central Board of the Indonesian Tobacco Farmers Association (APTI), Agus Parmuji, stated that the policy, initially claimed to reduce smoking prevalence, is ineffective if solely aimed at suppressing the number of smokers. According to him, what will occur first is an ‘economic tsunami’ in tobacco and clove farming centres.
“The plan to standardise cigarette packs into a single colour is a misguided step resulting from blindly adopting regulations from countries that have no industrial base or raw material supply for tobacco,” Agus said in a statement on Monday, 27 July 2026.
He believes the implementation of plain packaging is projected to bring three fatal impacts. These include the violation of intellectual property rights (IPR), a surge in illegal cigarettes that eliminates state excise revenue potential, and the destruction of competition for harvest purchases at the farmer level.
“Standardising packaging robs the intellectual property rights and brand identity built by manufacturers,” he said.
Agus added that the plain packaging design proposed by the Ministry of Health is extremely easy to counterfeit, which will trigger an explosion in the circulation of illegal cigarettes. This will ultimately lead to the loss of state revenue from Tobacco Excise (CHT) worth hundreds of trillions of rupiah, as well as result in the loss of product differentiation, suppressing prices and the absorption of farmers’ harvests.
“Standardising cigarette packs is a misguided step. This regulation does not respect IPR, kills competition at the farmer level, and instead legitimises the proliferation of illegal cigarettes. As a result, the state could lose excise revenue of up to hundreds of trillions of rupiah,” Agus said.
Beyond plain packaging, the rule banning additives is seen as exceeding reasonable limits. The national cigarette industry has a distinctive identity in the form of kretek, which blends tobacco with cloves and natural spices, producing a different taste for each brand. If everything is standardised, this distinguishing element will disappear. Currently, more than 90 per cent of national clove production is absorbed by the kretek cigarette industry. Therefore, an additive ban will automatically kill the kretek industry and destroy the livelihoods of millions of clove and tobacco farmers.