Sah, Sri Mulyani increases the cigarette excise tax by 12.5 percent for next year Page all

JAKARTA, KOMPAS.com – The government officially establishes a new policy related to the Rokkok tobacco or excise tax in 2021.

Finance Minister Sri Mulyani Indrawati explained that next year’s special smoking rates will increase by 12.5 percent.

“We will increase the excise tax on cigarettes in this case by 12.5 percent,” Sri Mulyani said in a virtual press release on Thursday (10/12/2020).

Also read: Here are 5 things Sri Mulyani considers in determining the 2021 special cigarette tariff

To find out, the policy discussion related to excise taxes this year is quite difficult. The announcement of the increase in special rates, which is usually made at the end of October, was delayed until the beginning of December.

Sri Mulyani said that this happened because the policy was being discussed in the environment of the Covid-19 pandemic. So the government needs to balance the health element with the economic aspect, that is, the groups affected by the pandemic, such as workers and farmers.

“So in this case, we are trying to balance the health element aspects at the same time considering the general economic conditions, which are affected by Covid-19, especially worker and farmer groups,” said Sri Mulyani.

Sri Mulyani also explained that the hand-rolled kretek cigarette industry did not see an increase in special rates.

Also read: Ministry of Finance establishes electric cigarette cartridges as excise duty products

This happened because the industry was a labor-intensive industry employing 158,552 workers.

“This means that the increase is 0 percent for hand-rolled kretek cigarettes, which have the largest workforce,” Sri Mulyani said.

Regarding the details of the increase of the special rates for each class of tobacco products, as follows:

White Cigarette Machine

1. Class I white cigarette machine 18.4 percent

2. Category IIA 16.5 percent white cigarette machine

3. Class IIB white cigarette machine 18.1 percent

Kretek Machine Made Cigarettes

1. Clove cigarettes for Category I machines 16.9 per cent

2. Machine Clove Cigarettes Category IIA 13.8 percent

3. Kretek IIB machine category 15.4 percent