A cigarette vendor waits for customers at his stall along a road in Surabaya, East Java, on Jan 29, 2023. - Photo: AFP
JAKARTA: Health organisations say the government’s decision not to increase the cigarette excise tax for next year represents a major step backward in reducing tobacco consumption in the country.
The decision showed the government’s willingness to make policies that benefited tobacco industry bigwigs at the expense of public health, said Hasbullah Thabrany, a public health professor at the University of Indonesia who heads the National Committee for Tobacco Control (Komnas PT).
He noted that a previous 10 percent increase in cigarette tax had failed to decrease smoking rates among minors and low-income families.
“Yet, despite that situation, the government decided not to raise the excise for next year,” Hasbullah said in a discussion on Thursday (Oct 3).
On Jan 1 of this year, the tax on electronic cigarettes went up 10 per cent.
In late 2022, the government announced an increase in taxes on machine-made clove cigarettes (SKM) and white cigarettes (SPM) of between 11 and 12 per cent, as well as a 5 per cent rise for hand-rolled cigarettes (SKT).
Yet the tax hikes failed to curb smoking, with the World Health Organisation (WHO) finding Indonesia among the 10 countries with the highest smoking rates.
According to the WHO report published in January of this year, 38.5 per cent of people above the age of 14 in the country used tobacco products in 2022, a 2 per centage point increase from the 2020 figure.
The increase bucked the declining global trend, and Indonesian smoking rates were projected rise further to 38.7 per cent by 2030.
Child smoking rates in Indonesia have also been rising, from 8.8 per cent of people under the age of 18 in 2016 to 10.7 per cent in 2019.
The figure could reach 16 per cent, Statistics Indonesia (BPS) predicts, if the government does not intervene seriously to reduce tobacco consumption.
Diah Saminarsih of the Center for Indonesia’s Strategic Development Initiatives (CISDI) warned that failing to raise the cigarette excise could prevent Indonesia from reducing the economic burden of noncommunicable diseases.
A CISDI study in 2021 found that smoking-related illnesses cost the country Rp 27.7 trillion (US$1.8 billion) annually.
“If the government doesn’t increase the tax by next year, it will be a huge step backward in the efforts to reduce these diseases’ burden on the economy,” Diah said in Thursday’s discussion.
The decision not to raise tobacco excise taxes runs counter to a recently issued Health Ministry regulation that puts stronger controls on tobacco sales and advertising to prevent underage smoking.
Aryana Satrya, head of the University of Indonesia’s Social Security Research Center (PKJS-UI), said taxing cigarettes was the most effective way to reduce tobacco use, especially among young people, as low prices would encourage teenagers who had quit smoking to relapse.
A 2020 survey by the centre found that a Rp 60,000 increase in the price of a pack of cigarettes would make 60 per cent of Indonesian smokers of all ages stop smoking.
If the price were increased by Rp 70,000, 70 per cent of the respondents said they would quit. Currently, the price of a pack of 20 cigarettes in the country is around Rp 40,000, about half of the average global cigarette price.
Diah of the CISDI said that aside from raising excise taxes, restricting sales of individual cigarettes and illicit tobacco products would be crucial to lower smoking rates in the country, particularly among young people.
Purchasing individual cigarettes tends to be more attractive to budget-constrained young people and could serve as a gateway for underage smoking, especially because individually sold cigarette lack warning labels.
Illegal cigarettes with fake or used excise stamps have cost the country trillions of rupiah and have impeded efforts to control cigarette consumption.
A 2020 study by Gadjah Mada University found that around 5 per cent of all cigarettes sold in the country were illicit.
In 2023, the Customs and Excise Office confiscated more than 253 million illegal cigarettes across the archipelago. - The Jakarta Post/ANN
