Indonesia: President Approves Tobacco Tax Hikes

Indonesian President Joko “Jokowi” Widodo approved a plan to increase tobacco taxes by 10 percent in 2023 and 10 percent in 2024, reports Tempo. The objective is to reduce the number of underage smokers.

“In today’s decision, the president has agreed to increase cigarette excise tax by 10 percent for [the] 2023–2024 period,” said Finance Minister Sri Mulyani after meeting at the Bogor Presidential Palace, West Java, on Nov. 3, 2022. 

The increase in excise will apply to machine-made “white” cigarettes, machine-made kretek cigarettes and sigaret kretek pangan products. 

Indonesia has struggled with high rates of underage smoking. The government aims to reduce smoking prevalence for 10-year-olds to 18-year-olds to 8.7 percent.  

Cigarettes also represent the second-largest household expense—just below rice—in Indonesia.