Indonesia Finance Minister seeks new tobacco excise tax layer

Indonesian Finance Minister Purbaya Yudhi Sadewa is seeking to implement a new layer in the tobacco excise tax (CHT) structure within this year, pending discussions with the House of Representatives (DPR RI). The policy aims to transition illegal cigarette circulation into the legal ecosystem through specific excise payments, with the government pledging strict enforcement against illegal operators.

In the 2027 Draft State Budget (RAPBN), customs and excise revenue is targeted at Rp 316.6 trillion, while total tax revenue is projected at Rp 2,591.4 trillion. This brings the total tax revenue target to Rp 2,908 trillion, representing a 10.5 percent increase from the 2026 projection. Key factors influencing these targets include economic performance projections for 2027, the continuity of tax reforms, and commodity price volatility.

Additionally, during the 81st Indonesian Independence Day ceremony, Minister Purbaya expressed optimism regarding the nation's economic trajectory. He noted the government's goal to achieve an economic growth rate of 6 percent or higher in 2027 and emphasized the importance of accelerating growth to ensure Indonesia's future prosperity.