Cigarette Excise Up 16% Next Year.

The government will raise the cigarette tax by 16 percent. The increase was already considering all parties, including the tobacco industry and health aspects.

According to Finance Minister Agus Martowardojo, it had consulted with the market to raise the cigarette excise tax. The increase was divided in the categorization of about 16 percent. These increases may increase state revenue.

“However, we do not count the estimated support the tax increase on state revenue,” he said in Jakarta, Friday, November 25, 2011.

The increase in tax rates that have such categorization for kretek cigarette machine (SKM) and clove cigarette hand (SKT), and white cigarettes.

“If it is said that 16 percent effective, it is not. Chances are effective in the range of 10 percent. However, when viewed overall it seems there is an increase 15-16 percent,” he added.

Previously, the government plans to raise the tobacco tax rates in 2012 of 12.2 percent. This is to prevent the circulation of illegal cigarette excise tax and state revenue while increasing.

In 2012, the government is targeting tax revenue amounting to Rp72, 44 trillion, up 6.4 percent compared to the budget target-Change 2011. For cigarette taxes, the government is targeting revenue of Rp69, 04 trillion, while the liquor excise Rp3, 4 trillion.

The government also estimates the production of cigarettes in the next year reached 268.4 billion cigarettes per year.

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