A coalition of Indonesian civil society groups rejected a government proposal to expand the country’s tobacco excise system by adding a new tariff tier, arguing it could undermine public health objectives and increase corruption risks. The Coalition Save Our Surroundings (SOS), which includes CISDI, Seknas FITRA, and Indonesia Corruption Watch, said the plan contradicts the primary purpose of excise policy of controlling consumption, and instead prioritizes revenue generation. Officials proposed adding a ninth tier to the existing structure to encourage illegal producers to enter the formal market, with potential implementation as early as May 2026.
Critics argue the move could complicate the system and enable “downtrading,” where consumers shift to cheaper products, while also creating opportunities for manipulation and weak enforcement. CISDI recommended simplifying the current structure rather than expanding it, and ICW warned that additional tiers could open new avenues for corruption through product misclassification. Government officials maintain the policy could help increase revenue and curb illicit trade, but civil society groups say it does not address underlying enforcement challenges.