JAKARTA: Finance Minister Bambang Brodjonegoro confirmed on Wednesday that cigarette taxes would increase after the value-added tax (PPN) hike, which was set to stand at 8.7 percent from the current 8.4 percent, took effect next year.
“I confirm that cigarette taxes will rise although the increases may not be as high as what has been expected in the state budget [APBN],” the minister said as quoted by Antara after he attended the launch of the Indonesia National Single Window (INSW) portal in Jakarta on Wednesday.
Bambang did not explain in detail how much the increase would be for cigarette taxes. “On the tax increase, we will see later what the cigarette tax increase deliberation will look like in the APBN,” he said.
Separately, Industry Minister Saleh Husin said the government’s policy on the increase for tobacco products would be counterproductive with the national cigarette industry’s policy.
He said it was worried that a PPN hike, which occurred together with cigarette tax increases, would trigger more worker layoffs in cigarette factories in Indonesia.
