Indonesia's E-Cigarette Industry Opposes Tax Reform Implementation

Regulations by 2FIRSTS.ai
Jan.08.2024
Indonesia's E-Cigarette Industry Opposes Tax Reform Implementation
Indonesian e-cigarette industry opposes government's plan to implement tax reform in 2024 due to rising cigarette taxes and retail prices.

According to a report by Liputan6.com on January 8th, the Indonesian Ministry of Finance released a regulation on December 29th, 2023, regarding the reform of e-cigarette taxes, which is planned to be implemented on January 1st, 2024. However, this policy has faced strong opposition from the industry, primarily due to the Ministry of Finance's decision to simultaneously increase cigarette taxes and retail prices in 2024.

 

Previously, the e-cigarette industry had already dealt with the pressure brought by a 15% increase in tobacco taxes and retail price hikes. This time, e-cigarette tax reform has become the third major blow this industry has faced in 2024. Businessmen have been demanding a postponement of tax adjustments on e-cigarettes to cope with the impact of these three tax increases.

 

Businessmen in the e-cigarette industry have raised complaints, stating that they were caught off guard by the announcement of e-cigarette tax reform. This is because in early December, they had already placed orders for tobacco labels required for 2024, following the procedures outlined by the General Directorate of the Indonesian Ministry of Finance.

 

This sudden policy change has sent shockwaves throughout the industry, particularly against the backdrop of steep increases in tobacco taxes and retail prices. Business owners are urging the government to reconsider this policy and delay the implementation of e-cigarette tax adjustments. This tax reform represents yet another significant transformation for the e-cigarette industry in less than a year.

 

The Indonesian National e-Cigarette Association (PAVENAS) has stated that this policy has had a significant impact on the industry, as there has been insufficient community outreach, tight response time, and financial implications for businesses.

 

Garindra Katasamita, Secretary General of the Indonesian Personal E-Cigarette Association (APVI), representing PAVENAS, expressed deep disappointment over the rushed and opaque decision-making process of the Indonesian Ministry of Finance, which failed to consider feedback from affected industries. This has led us to urge them to reconsider this policy and postpone the implementation of the tobacco tax reform.

 

According to Galindra, the government's sudden announcement regarding the e-cigarette tax reform for 2024 during a community outreach event on December 27th has taken the Indonesian National E-Cigarette Association (PAVENAS) by surprise.

 

We welcome news tips, article submissions, interview requests, or comments on this piece.

Please contact us at info@2firsts.com, or reach out to Alan Zhao, CEO of 2Firsts, on LinkedIn


Notice

1.  This article is intended solely for professional research purposes related to industry, technology, and policy. Any references to brands or products are made purely for objective description and do not constitute any form of endorsement, recommendation, or promotion by 2Firsts.

2.  The use of nicotine-containing products — including, but not limited to, cigarettes, e-cigarettes, nicotine pouchand heated tobacco products — carries significant health risks. Users are responsible for complying with all applicable laws and regulations in their respective jurisdictions.

3.  This article is not intended to serve as the basis for any investment decisions or financial advice. 2Firsts assumes no direct or indirect liability for any inaccuracies or errors in the content.

4.  Access to this article is strictly prohibited for individuals below the legal age in their jurisdiction.

 

Copyright

 

This article is either an original work created by 2Firsts or a reproduction from third-party sources with proper attribution. All copyrights and usage rights belong to 2Firsts or the original content provider. Unauthorized reproduction, distribution, or any other form of unauthorized use by any individual or organization is strictly prohibited. Violators will be held legally accountable.

For copyright-related inquiries, please contact: info@2firsts.com

 

AI Assistance Disclaimer

 

This article may have been enhanced using AI tools to improve translation and editorial efficiency. However, due to technical limitations, inaccuracies may occur. Readers are encouraged to refer to the cited sources for the most accurate information.

We welcome any corrections or feedback. Please contact us at: info@2firsts.com

2Firsts Hosts U.S. Compliance Briefing on Building PMTA Support Capabilities Across the Nicotine Supply Chain
2Firsts Hosts U.S. Compliance Briefing on Building PMTA Support Capabilities Across the Nicotine Supply Chain
2Firsts held a U.S. compliance briefing in Shenzhen to help vaping, heated tobacco and nicotine pouch supply chain companies strengthen PMTA support capabilities. The event focused on supplier documentation, quality systems, traceability, TPMF/TPMP pathways, age verification and customer audit readiness as U.S. compliance expectations increasingly extend deeper into the nicotine supply chain.
Events
Jun.12
KT&G to Cancel All 10.87 Million Treasury Shares on April 23
KT&G to Cancel All 10.87 Million Treasury Shares on April 23
KT&G disclosed on April 16 that it will cancel all 10.87 million treasury shares it currently holds, with the planned cancellation amounting to about KRW 1.85 trillion,(USD 1.26 billion). The cancellation date is scheduled for April 23.
Apr.17 by 2FIRSTS.ai
Philip Morris Says Its Smoke-Free Transition in Spain Now Has Economic Impact Above EUR 3.3 Billion
Philip Morris Says Its Smoke-Free Transition in Spain Now Has Economic Impact Above EUR 3.3 Billion
Philip Morris said it is accelerating its transition toward smoke-free products in Spain and claimed that the related economic impact now exceeds EUR 3.3 billion. Philip Morris also said that more than 90% of nicotine consumption in Spain still comes from conventional cigarettes, leaving room for growth in smoke-free categories, while regulation and taxation remain major obstacles in its view.
Apr.21 by 2FIRSTS.ai
BAT Uzbekistan and Regulators Discuss Production Modernization and Export Expansion
BAT Uzbekistan and Regulators Discuss Production Modernization and Export Expansion
A meeting was held at the Department for Combating Economic Crimes under the General Prosecutor’s Office of Uzbekistan with representatives of British American Tobacco Uzbekistan. Participants included the department’s leadership, the Inspectorate for Regulation of the Alcohol and Tobacco Market, and business representatives.
May.09 by 2FIRSTS.ai
Acting CTP Director Says FDA Cut Premarket Tobacco Application Backlog by About 70% Over the Past Year
Acting CTP Director Says FDA Cut Premarket Tobacco Application Backlog by About 70% Over the Past Year
FDA Center for Tobacco Products Acting Director Bret Koplow said at the American Tobacco and Nicotine Forum that the agency has reduced its premarket tobacco application backlog by about 70% over the past year and eliminated the acceptance queue. He said FDA has reviewed about 27 million applications, but only a small number have been authorized, mainly because most submissions lacked the scientific data needed to demonstrate public health benefits.
Apr.23 by 2FIRSTS.ai
Argentina’s New Nicotine Rules Draw Cautious Optimism and Market Concerns, Local Tobacco Harm Reduction Advocate Says
Argentina’s New Nicotine Rules Draw Cautious Optimism and Market Concerns, Local Tobacco Harm Reduction Advocate Says
Argentina’s new tobacco and nicotine framework marks a shift from prohibition toward registration, traceability and health surveillance. Argentine THR advocate Juan Facundo Teme told 2Firsts that adult consumers and parts of the local commercial sector are cautiously optimistic, but concerns remain over flavor limits, registration costs and market access. The policy’s implementation may determine whether Argentina can move informal sales into regulated channels.
May.11