Purbaya Confirms Cigarette Tax Rate for 2027 Will Not Rise

The Indonesian Minister of Finance, Purbaya Yudhi Sadewa, has stated that there are no plans to alter the cigarette tax rate (CHT) in 2027, meaning the tobacco tax rate will neither rise nor fall next year. He told reporters at the Ministry of Finance in Jakarta on Tuesday, 19 May 2026, that the government is prioritising stability in the tobacco industry while strengthening state revenue monitoring from the sector. ‘I will keep the cigarette tax rate constant, not increasing and not decreasing. I want to see stability first,’ he said. Rather than planning changes to the cigarette tax rate, Purbaya is focusing on digitalising industry oversight by installing production-counting machines at several cigarette factories. The strategy aims to reveal the real potential of revenue from the tobacco industry and to curb illicit cigarette activity. The state treasurer will monitor developments in revenue after this strategy is implemented, which will form the basis for future tax policy directions. ‘Perhaps everything will be digitalised gradually. From that, I want to see what the net revenue from cigarettes actually is. In other words, if the illicit side can be eliminated, I will calculate whether the CHT needs to rise or fall,’ he said. The performance of customs and excise revenue overall has shown a positive trend. As of April 2026, customs and excise receipts totalled Rp100.6 trillion, equivalent to 29.9 percent of the state budget target (APBN) and up 0.6 percent. Revenue from excise reached Rp74.8 trillion or up 2.2 percent, driven by increased cigarette production in the first quarter of 2026. Imports duties also rose 6.4 percent to Rp16.4 trillion. Import duties performance remains supported by LPG and project requirements. Meanwhile, export duties contracted 17.5 percent to Rp9.3 trillion. Despite the contraction, export duty performance has begun to improve as crude palm oil (CPO) prices strengthened in March and April.