Demand for Clear Regulations on Tobacco Tax in Indonesia

Dec.11.2022
Demand for Clear Regulations on Tobacco Tax in Indonesia
Indonesia's Kadin urges government to issue regulations on tobacco product consumption tax policy. Increased tax rates cause anxiety among business participants.

On Friday, September 12th, 2022, Adik Dwi Putranto, the Chairman of the East Java Chamber of Commerce in Indonesia (second from the right), participated in a discussion regarding the increase in consumption tax in the city of Surabaya.


Surabaya, Indonesia - The East Java Chamber of Commerce (Kadin) has called on the government, particularly through the Ministry of Finance, to immediately issue a regulation that will standardize the consumption tax policy for tobacco products (CHT).


Adik Dwi Putranto, the chairman of Kadin in East Java, stated in a written statement on Friday in Surabaya that this decision was made in response to the government's announcement in early November 2022 to increase the CHT tax rate by 10% in 2023 and 2024.


There are no clear rules for managing the detailed description of CHT tax rates. This has caused anxiety among business participants as they are unable to plan for purchasing consumption tax stamps in January 2023, which should have been possible as early as December 2022," he said.


Adik stated that the ambiguity of the consumption tax regulations is another issue that enterprise participants must face, along with the burden of increased consumption tax rates.


In fact, he continued, the cigarette consumption tax has increased significantly in recent years, which has become increasingly burdensome for participants in the tobacco products industry (IHT). In addition, there are currently no standard rules regarding tariffs that have been released.


This will undoubtedly disrupt business continuity, especially for companies that no longer have inventory consumption tax stamps, as they must stop operations until an unknown time. "This creates business uncertainty," said Adik.


Adik stated that the continuous distribution of PMK (a tobacco product regulation) is a problem that has significant impacts on the entire tobacco product supply chain. In line with this, the East Java Chamber of Commerce has also expressed its opinion on the government's decision to increase consumption tax for two years.


In line with this, Sulami Bahar, Chairman of the Cigarette Companies Association (Gapero), expressed his hope that the government can better support legitimate business actors in the IHT by implementing clear and transparent regulations.


Sulami states that tobacco companies are facing various pressures such as consumption tax and illegal cigarettes.


According to Sulami, a 10% growth in the next two years is considered to be very high, especially as we need to compete with the illegal cigarette market that is currently circulating.


Sulami expressed concern, stating, "We are worried that if this industry continues to face such pressure, they will close factories or, even worse, turn to illegal cigarettes. In reality, the government has rolled out the red carpet for them.


The owner of PT Surya Hutama Anugerah, Sandee Surya, who also serves in the governance department of the Indonesian Steam Entrepreneur Association (APVI), expressed disappointment with the delay of the PMK decision. The company had already established the plan, but due to the delay, it cannot be implemented immediately.


This is very inconvenient because we already have a plan prepared, but we are not allowed to proceed with P3C recitation yet. It is indeed difficult because slow decision-making has resulted in the concept being put on hold and ultimately postponed," said Sandy.


As such, the e-cigarette industry is hoping for a prompt decision on PMK in order to immediately execute the company's plans. He stated, "We believe that raising prices is already difficult enough, so delaying further is not an option. A decision must be made immediately.


Sandee added that it has been decided to increase the consumer tax for the electronic cigarette industry by 15% in 2023, which saw a growth of 17.5% last year. With this increase, it is bound to become even more significant.


2FIRSTS will continue to track and report on this topic, with further updates available on the "2FIRSTSAPP." Scan the QR code below to download the app.



Disclaimer

This article is provided solely for professional research, industry discussion, and informational purposes. Any references to brands, companies, products, technologies, or policies are made for factual reporting and analytical purposes only, and do not constitute endorsement, recommendation, promotion, or advertising by 2Firsts.

Nicotine-containing products, including but not limited to cigarettes, e-cigarettes, heated tobacco products, and nicotine pouches, carry significant health risks. Readers are responsible for complying with all applicable laws and regulations in their respective jurisdictions, including age restrictions and access limitations.

The information contained in this article should not be regarded as investment, legal, medical, regulatory, or commercial advice. While 2Firsts strives to ensure the accuracy and reliability of its content, it does not assume liability for any direct or indirect loss arising from errors, omissions, inaccuracies, or reliance on the information contained herein.

This article is not intended for individuals below the legal age for accessing tobacco or nicotine-related information in their jurisdiction.

 

Copyright Notice

This article is either original content produced by 2Firsts or content reproduced, translated, summarized, or adapted from third-party sources with attribution where applicable. The intellectual property rights of the original content remain with 2Firsts or the respective original rights holders.

No individual or organization may copy, reproduce, distribute, republish, modify, translate, or otherwise use this content without prior authorization. Any unauthorized use may result in legal action.

For copyright-related inquiries, corrections, or removal requests, please contact: info@2firsts.com.

 

AI-Assisted Translation and Editing Notice

Portions of this article may have been translated, edited, or reviewed with the assistance of artificial intelligence tools to improve efficiency and readability. Due to the limitations of AI-assisted translation and editing, discrepancies, omissions, or inaccuracies may exist when compared with the original source.

Where applicable, readers are advised to refer to the original source for the most complete and accurate information. If you identify any errors or believe that any content infringes upon your rights, please contact us at info@2firsts.com, and we will review and address the matter promptly.

Australian Coalition Unveils Illicit Tobacco Plan With 80% Excise Cut and Legal, Taxed Vapes and Nicotine Pouches
Australian Coalition Unveils Illicit Tobacco Plan With 80% Excise Cut and Legal, Taxed Vapes and Nicotine Pouches
Australia’s Coalition has unveiled a national illicit-tobacco policy that would cut tobacco excise by 80% and create legal, regulated and taxed adult markets for vaping products and nicotine pouches if it wins government. The plan proposes an excise of A$0.50 per millilitre of e-liquid and A$0.025 per milligram of nicotine in pouches, alongside A$200 million in additional enforcement and a A$60 million three-year public-awareness campaign. The Coalition says the package would narrow the price advantage of illicit products and undermine organised crime, while Labor and public-health groups warn that dramatically cheaper cigarettes could reverse long-term declines in smoking.
Sep.03
Product | JNR Launches Crown Shisha 100K for International Wholesale, Pairing 58ml Capacity With Triple-Mesh DTL Design
Product | JNR Launches Crown Shisha 100K for International Wholesale, Pairing 58ml Capacity With Triple-Mesh DTL Design
JNR released the Crown Shisha 100K on August 14, 2026, positioning the ultra-high-capacity disposable around a direct-to-lung (DTL) e-shisha experience. The device combines a 58ml e-liquid capacity, triple 1.0Ω mesh coils and a 1,300mAh rechargeable battery, with JNR claiming up to 100,000 puffs. Adjustable airflow, battery and e-liquid status displays, a leather-style exterior and a shisha-inspired sound effect further differentiate the product. JNR is currently promoting the device through international wholesale and distribution channels, while a specific first retail market has not been disclosed.
Aug.31
Imperial Brands Plans Thousands of Job Cuts Across U.S. and Europe in Cost Restructuring
Imperial Brands Plans Thousands of Job Cuts Across U.S. and Europe in Cost Restructuring
According to Reuters, citing Bloomberg News, British tobacco company Imperial Brands PLC plans to cut thousands of jobs across the United States and Europe as part of a cost reduction and organizational restructuring effort. The announcement drew market attention to the company’s shares. The move comes as global tobacco companies continue adjusting their operations amid slower cigarette market growth, changing consumer preferences and the transition toward next-generation nicotine products.
Aug.11
India Duty-Free Nicotine Pouch Sales Face Regulatory Test as ZYN, FOX Classification Remains Open
India Duty-Free Nicotine Pouch Sales Face Regulatory Test as ZYN, FOX Classification Remains Open
The Bombay High Court has ruled that airport duty-free shops are not exempt from India's domestic regulatory laws merely because they operate beyond the customs barrier, leaving in place a sales halt covering ZYN and FOX nicotine pouches at Mumbai's international airport. The court, however, did not determine that the products necessarily qualify as "drugs" under India's Drugs and Cosmetics Act. The retailers have four weeks to submit product information to the appropriate authorities, including CDSCO, which must complete its review within 30 days of receiving the submissions.
Sep.24
Senate Democrat Wyden Probes Trump Administration Vape Policy Shift, Seeks Records From HHS and Reynolds American
Senate Democrat Wyden Probes Trump Administration Vape Policy Shift, Seeks Records From HHS and Reynolds American
U.S. Senator Ron Wyden, the Democratic ranking member of the Senate Finance Committee, has launched an investigation into flavored vape policy changes and requested records from the Department of Health and Human Services (HHS), Reynolds American and Botanic Tonics. The investigation focuses on a timeline involving Reynolds American’s $5 million donation to MAGA Inc. in April 2026 and subsequent vape policy developments. Wyden said the review aims to examine potential links between political donations, corporate communications and government decisions. The investigation does not represent a finding of wrongdoing.
Innovation
Aug.07 by 2Firsts Perspectives
Product | KT&G to Launch lil Tonino Lamborghini in South Korea, Bringing 3-Second Heat-Up to New HTP Platform
Product | KT&G to Launch lil Tonino Lamborghini in South Korea, Bringing 3-Second Heat-Up to New HTP Platform
KT&G will launch the lil Tonino Lamborghini heated tobacco device in Seoul on September 15, 2026. The product introduces a new heating technology called Flashwave Heating, which uses microwaves to heat tobacco sticks internally and delivers a manufacturer-rated heat-up time of about three seconds. The device features an all-metal aluminum body, a color display and a dedicated GUI, and launches alongside a new line of NAU tobacco sticks that are incompatible with existing lil consumables. Korean media describe the product as KT&G's first new heated tobacco platform since lil AIBLE was introduced in 2022.
Aug.31