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Simplification of tobacco excise rates will likely have a direct impact on farmers.
REPUBLIKA.CO.ID, JAKARTA – Tobacco producers are asking the government to review the rules on the simplification of tobacco excise duties. The rules that combine white-machine cigarettes (SPM) and kretek machine (SKM) are considered prejudicial to farmers as tobacco sellers.
Agus Parmuji, chairman of the National Leadership Council of the Indonesian Association of Tobacco Producers (APTI), said: simplify the tobacco excise tariffs regulated in Regulation No. 146/2017 of the Minister of Finance (PMK) must take into account the overall impact, both on tobacco producers and on the national clove industry.
"We want the policy to be reviewed with special attention to the contribution of all concerned," Agus said Friday (10/26).
Referring to the APTI study, the simplification of excise duty rates on tobacco has a direct impact on tobacco producers. In addition, this can reduce the state revenue from excise on cigarettes.
"The simplification of excise duties will kill the national industry of kretek, a local tobacco absorber for local farmers," said Agus.
The simplification of five-tier tariffs will potentially lead to the bankruptcy of domestic manufacturers. The reason is that they can not compete with big players.
In addition, the incorporation of excise tariffs on handmade Kretek cigarettes (SKT) groups 1A and 1B will also remove SKT products from the manufacturer.
"The problem is that the too high increase in retail prices (HJE) will greatly affect the sustainability of small and medium-sized manufacturers, as their consumers are very sensitive to rising prices," he said. .
According to Agus, other simplification policies of excise taxes have the effect of increasing the use of imported raw materials.
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