Purbaya Does Not Intend to Change Cigarette Tax Rates in 2027

Jakarta (ANTARA) - Finance Minister Purbaya Yudhi Sadewa has said he does not intend to change the cigarette excise duty rate in 2027. In other words, the cigarette excise rate will neither rise nor fall next year. Purbaya told journalists at the Ministry of Finance in Jakarta on Tuesday that the government is currently choosing to maintain stability in the tobacco products industry while strengthening state revenue monitoring from the sector. ‘(The cigarette excise rate) I will keep it constant — no rise and no fall. I want to see the stability first,’ he said. That strategy is being implemented to identify the real potential State revenue from the tobacco industry. In addition, the digitalisation of the oversight is aimed at curbing illegal cigarette trading. The state treasurer will monitor revenue developments once the strategy is in place, which will later form the basis for considerations in determining the direction of excise policy going forward. ‘(Perhaps, gradually everything will be digitalised. From that, I want to see actually how much net revenue from cigarettes there is. That means, if we can strip out the shadow economy, from which I will determine whether the CHT needs to rise or fall,’ he said. Tobacco excise revenues amounted to Rp74.8 trillion, up 2.2 percent, driven by higher cigarette production in the first quarter. Import duties also grew positively by 6.4 percent to Rp16.4 trillion. The performance of import duties remained supported by LPG commodities and project needs. Meanwhile, export duties revenue contracted 17.5 percent to Rp9.3 trillion. Although it contracted, export duties performance is said to be improving in line with the strengthening price of crude palm oil (CPO) in March and April.