The finance minister sri mulyani already fixed the increasing of tobacco excise averagely 10.54% as mentioned in regulation of finance minister no. 147/PMK.010/2016 concerning the amandment of tobacco excise.
This regulation also estavlishes retail price of cigarettes higher than previously. The excise tobacco is mentioned have to be higher likewise the retail price of cigarette. The retail price of cigarette mentioned is regulated in annex II and anex III coming into force on january 2017. Referring to this finance ministry regulation, retail price of cigarette the lowest is Rp 655, previously Rp 59 then white cigarette retail prices least is Rp 585 from Rp 505 previously.
The lowest retail selling for hand rolled and machine cigarettes is Rp 400 from Rp 370 and cigarette filter is Rp 655 from Rp 590.
While the lowest price for imported tobacco is Rp 1.120.
The consideration of government to increase excise of tobacco and retail price of cigarette is to control the consumption of the cigarette and also for continuous revenue from tobacco excise.
Some economist how ever criticize on this step taken by government for reducing cigarette consumption. The plan of tobacco tax increase rate in 2017 is lowest than the this year which 11.19%. This is considered to be too conservative. The tax increase will not definitely restrain the rate of consumption in society. The plan of 10.54% tobacco tax raise in certain term is not pro for the health and economy sake of the people. This alludes to the reality how cigarettes become one of largest daily spending for active smokers.
This is tantamount to say that tax as instrument to control the tobacco consumption is absolutely fail.
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