2022 State Budget: Fiscal Policy and Structural Reform
EXCISE RATES FOR TOBACCO PRODUCTS
Instruments to Improve The Quality of Human Resources
4 Pillars of Tobacco Excise (CHT) Policy
1. Consumption Control
The imposition of excise is intended as an effort to control
consumption as mandated by the Excise Law. In addition, it
is also part of the National Medium-Term Development Plan
(RPJMN) 2020-2024 to improve the quality of human
resources through reducing smoking prevalence, especially
those aged 10-18 years, which is targeted to be 8.7% in
2024.
2. Labor Sustainability
The excise policy also considers the impact on tobacco
farmers, workers, and the tobacco products industry.
3. Revenue Improvement
Excise policy supports national development programs
through revenue
4. Supervision of Illegal Excisable Goods
The importance of mitigating the impact of policies that have
the potential to encourage illegal cigarettes
The Main Points of 2022 CHT Policy Changes
(Effective in January 2022)
Adjustment of excise tariffs and the floor retail price for
all types of cigarettes by a weighted average of 12%
Simplification of the tariff structure to 8 layers
Optimizing the CHT Revenue Sharing Fund (DBH) policy
as a cushion for the CHT policy
The adjustment of excise rates and the minimum limit
for retail selling price types of E-Cigarettes and Other
Tobacco Processing Products is 17.5%, with specific
excise rates. The 2022 CHT policy will reduce cigarette
consumption by an average of 3.0% per year
Source: Ministry of Finance
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