EXCISE TAX IS TOO LOW TO CURB CIGARETTE CONSUMPTION

By Andi Abdussalam

Jakarta, Oct 28 (Antara) - The government has decided to impose a 10.04 percent excise tax hike on tobacco-based products, particularly cigarettes, beginning January 2018, yet the consumer institute describes it a setback, as it will not reduce cigarette consumption.          In terms of percentage, the 10.04 percent increase in excise tax is a setback, as the hike is too low, and even it is lower than the 11.19 percent in 2016. Every tax hike should be progressive until it reaches the minimum 57 percent, as mandated by the Law on Excise.          Hence, the prevalence of smoking in Indonesia is forecast to increase further, with a hike of only 10.04 percent in the tobacco excise tax in 2018, according to the Indonesian Consumers Foundation (YKLI).          "Poor families and juveniles can still afford to buy cigarettes. An increase of 10.04 percent (in the excise tax) will only raise the price by Rp30 to Rp50 per cigarette," YLKI Chairman Tulus Abadi stated in Jakarta on Thursday (Oct 26).          However, Director General of Customs and Excise of the Ministry of Finance Heru Pambudi explained that the policy on excise tax on tobacco-based products is decided after taking into account four factors: health, cigarette industry, labor or employment, and state revenue.

SMOKING PROBLEM MUST BE RESOLVED BY REACHING OUT TO CHILDREN

by Andi Abdussalam

Jakarta, May 16 (Antara) - Health Minister Nila Djuwita Moeloek said at the opening of the Fourth Indonesia Conference for Tobacco or Health (ICTOH), Monday, that the steady rise in the number of child smokers should not be left unresolved.          The minister made the statement as the number of child smokers has reached an alarming level. She said more than one-third of the population, or 36.3 percent, are smokers. Some 20 percent are youth in the age group of 13 to 15 years.          A youth community group, Smoke Free Agent (SFA), said 54 percent of Indonesian children were found to be smokers last year. It's a challenge to wean away children from smoking.          Amid concerns over health hazards, cigarette industries are also intensively promoting their products/cigarettes. Children are the easiest target for the future market. If cigarette industries fail to get child patrons, they will collapse in the coming generation.          This poses a huge challenge to overcoming the increasing trend of child smokers.          Moreover, if the government banned cigarettes, it would have a significant impact on the life of about 5.8 million people, including 401,989 workers in formal cigarette industries, 2.9 million tobacco farmers, 1.5 million clove growers and one million cigarette retail traders.

CIGARETTE PRICE HIKE CONSIDERED LOW

By Andi Abdussalam

Jakarta, Oct 1 (Antara) - Recent media reports about the possibility of the government hiking cigarette prices to about Rp50 thousand ($3.76) per pack, from Rp15 to 25 thousand ($1.13 to $1.88) have triggered an intense public debate.          Much of the talk is centered around whether the price hike was too high, the efficacy of efforts to cut down the number of smokers, the fate of tobacco industry workers and tobacco farmers and similar other issues.          The idea to increase the price of cigarettes was first floated by Hasbullah Thabrany of the Health and Economic Study Center of the Community Health Faculty of the University of Indonesia (FKMUI).          In keeping with Finance Minister Sri Mulyani's views, the decision to hike the excise rate and cigarettes prices was taken in accordance with the Excise Law and was also included in the draft state budget.        "The Finance Ministry has not yet issued any new regulation regarding hiking the retail sales price or excise tariff on cigarettes," she had said in August.          However, on Friday, the minister announced that the government¿s decision to raise the excise duty on tobacco. It will become effective next year as per the Finance Minister's Regulation No.147/PMK.010/2016.

CIGARETTE PRICE HIKE YET TO BE DECIDED

by Andi Abdussalam

Jakarta, Aug 29 (Antara) - The government is yet to take a decision on increasing the excise rate and sales price of cigarettes in the country as it still has to conduct a study to evaluate the pros and cons.          Since the proposal on the price hike was put forth in July, several quarters have suggested making careful evaluation before the cigarette price is hiked.          Legislator Mukhamad Misbakhun of Commission XI of the House of Representatives stated at a discussion in Jakarta on Saturday (Aug. 27) that the government should conduct careful evaluation before deciding to increase the excise rate and price of cigarettes.          According to Finance Minister Sri Mulyani, the government has not yet issued a new sales price and excise rate.          "The Finance Ministry has not yet issued any new regulation regarding the retail sales price or excise tariff of cigarettes," she noted in Jakarta last week.          The public has been involved in debates and discourse as reports circulated lately that President Joko Widodo will increase the price of cigarettes to almost two folds that of the current price to Rp50 thousand per pack.

CIGARETTE EXPENSES SHOULD BE DIVERTED TO IMPROVE NUTRITIONAL INTAKE

by Andi Abdussalam

Jakarta, Aug 25 (Antara) - Instead of damaging your lungs with smoke and increasing cancer risk, the citizens should utilize the money to increase the nutritional intake of their families and help  improve the quality of human resources.          The answer to this problem is probably most sought by various circles from the health sector and the younger generation that have, so far, called on the government to ratify the Framework Convention on Tobacco Control treaty.         It is clear that the treaty will harm the interests of the tobacco industries and tobacco farmers, and they along with the smokers have jointly opposed it. Hence, the government's recent idea to significantly hike the price of cigarettes has immediately sparked positive and negative reactions.         While targeting to boost state revenues from cigarette taxes, the idea is also aimed at reducing the number of smokers. However, only time will tell if implementing the idea to hike cigarette prices will reduce the number of smokers while simultaneously increasing tax receipts from cigarette sales.

GOVERNMENT WARNED OF CIGARETTE PRICE INCREASE

By Andi Abdussalam

Jakarta, Aug 21 (Antara) - The government's reported plan to significantly hike cigarette prices has sparked pros and cons reactions from various circles such as cigarette industries, lawmakers and  other quarters.          Chairman of the Indonesian White Cigarette Producers Association (Gaprindo), Muhaimin Moefti expressed worries that the plan if implemented would harm cigarette industries. Some factories can face bankruptcy and close down.          The significant price increases can reduce industries sales turnover as cigarette consumption by  low-income people will decline. It can also lead financially weak addicted smokers to commit crimes.          The normal prices of cigarettes currently range from Rp15,000 to Rp25,000 (US$1.13 - US$1.88) per pack. The government is planning to raise prices up to about Rp50,000 (US$3.76) per pack.     This means that a smoker who consumes one pack of cigarettes a day would spend some Rp1.5 million per month for cigarettes, a price which is higher than the workers' monthly basic minimum wage of Rp1.4 million in West Nusa Tenggara Province, for instance.

DRUG MONITORING AGENCY TO PROBE CIGARETTE MANUFACTURERS

By Andi Abdussalam

Jakarta, Sept 18 (Antara) - The Drug and Food Monitoring Agency (BPOM) will investigate cigarette manufacturers that have allegedly violated regulations by not displaying pictorial health advisories on cigarette packets.          Following up on a report by activists claiming that more than 50 percent of cigarette manufacturers surveyed did not display pictorial health warnings on their cigarette packets, the BPOM will begin monitoring packages.          "We will cooperate with police in carrying out the examinations. If they are found guilty of violating regulations, they will be acted upon based on the law in force," Elly Mutiawati of the BPOM said on Wednesday.          She noted that the BPOM has signed a memorandum of understanding on the supervision of food products and other goods, including cigarettes, which contain chemical substances and harm public health.          "A comprehensive supervision and investigation should be carried out first, before taking actions against violators," Elly said.

INDONESIA TRIES TO CONTROL TOBACCO WITHOUT TREATY

By Andi Abdussalam

Jakarta, Aug 23 (Antara) - The Indonesian government has long tried to protect people from the injurious effects of smoking, while at the same time continuing to enjoy significant amounts of tobacco taxes, reaching over Rp80 trillion annually.          The World Health Organization (WHO) has, since May 21, 2003, circulated a treaty, called the FrameWork Convention on Tobacco Control (FCTC), in an effort to control tobacco consumption.          The Indonesian government, however, has not yet displayed its intention to ratify the convention, as many favor and oppose the treaty at home.          Of course, the ultimate goal of the treaty is to reduce the number of smokers, something that will have an impact on tobacco farmers and industries, as well as state revenues from cigarettes and tobacco taxes.          Despite the fact that Indonesia has yet to ratify the convention, the government has been attempting to launch anti-smoking campaigns.          To this end, the government has begun a campaign banning smoking in public locations. It has also issued Regulation No. 109, 2012, which bans the sale of cigarettes to youths below 18 years old.

GOVT TO EVALUATE IMPACT OF PICTORIAL WARNING ON CIGARETTES

By Andi Abdussalam

Jakarta, Aug 23 (Antara) - Facing opposition from various quarters as it looks to accede to the WHO Framework Convention on Tobacco Control (FWCTC), the government has asked cigarette companies to put gruesome pictures on cigarette packets to discourage smokers.          Indonesia has been launching anti-smoking campaigns with written warnings on cigarette packets but it seems it is not effective enough. According to reports in Kompasiana publication on May 4, 2014, Indonesia has the third largest number of smokers in the world with cigarette consumption at about 305 billion pieces in 2012.          Ideally, the government would like to accede to the FWCTC which aims to reduce the number of smokers and protect the present and future generations against health damage. Yet, that move is opposed by many quarters, including tobacco farmers and the sections of the industry.          Therefore, it is now doing its best to discourage smokers. Beginning June 24, 2014, cigarette packets will carry pictorial warnings with gruesome images of people suffering from different tobacco-related diseases such as oral, gangrene, mouth, neck and lung cancers.          The pictorial warning on cigarette packets will be effective in reducing the number of smokers and preventing young people from taking up the habit, Health Minister, Nafsiah Mboi, believed.

RI HEMMED-IN BETWEEN BENEFITS AND HAZARDS OF TOBACCO

By Andi Abdusslam

Jakarta, Sept 27 (Antara) - The Indonesian government has not yet discussed whether it will ratify the Framework Convention on Tobacco Control (FCTC), as it is still hemmed-in between economic benefits of tobacco and protecting the public's health.          In order to protect the people's health from the risks of tobacco, the government has launched a campaign banning smoking in public locations. It has also issued Regulation No. 109, 2012 which bans the sale of cigarettes to youths below 18 years old.         But all this has not had a significant impact, reduced the number of smokers or discouraged people from smoking in public. After all, the tobacco industry is a main source of the country's income. At least 6.1 million people work in cigarette industries or as tobacco farmers.          In 2012 and 2013, for example, the country received at least Rp84 trillion and Rp85 trillion, respectively, in tobacco taxes.          So, from an economic point of view, tobacco is a source of revenue for the state and income for millions of people, which is why the government has not yet ratified the Framework Convention on Tobacco.

RI WANTS US TO SCRAP ITS 'KRETEK' CIGARETTE BAN

By Andi Abdussalam

Jakarta, July 1 (ANTARA) - Indonesia has urged the United States to lift its ban on aromatic cigarette imports that would cause Jakarta to cut its 'kretek' (clove-flavored) cigarette exports to that country and reduce its foreign exchange earning.          "Indonesia's foreign exchange income from kretek cigarette exports is expected to drop significantly this year due to the imposition of the ban," Frans Rupang, director for prosecution and prevention of the Directorate General of Customs, said.          The United States has imposed the ban since September 2009 based on its law that prohibits the entry into the country of aromatic tobacco, yet both nations are still negotiating the matter.          According to US Ambassador to Indonesia Cameron R Hume, Indonesia and the US are still negotiating the US ban on Indonesia's kretek cigarette exports to the United States.          Speaking on the sidelines of the US Independence Day anniversary which falls on July 4, in Surabaya, East Java, on Thursday evening, Cameron R Hume said that Indonesia was of the view that the ban violated the World Trade Organization (WTO)'s regulations.          Therefore, the United States and Indonesia were discussing the matter but the envoy said he could predict what would come out of the negotiation process. "Let's wait," he said.          However, if the United States remains to impose the ban, Indonesia's cigarette exports and income from this sector would decline significantly.          Frans Rupang said that in 2009 cigarette exports contributed 6.451 million dollars to the state.  Indonesia's kretek cigarette exports to the United States in 2008 totaled 298.932 million pieces worth US$6.662 million and in 2009 they stood at 267.308 million pieces worth US$6.451 million.          Since the imposition of the ban,  there was practically no Indonesia's kretek exports to the United States this year.          Rupang said that the contribution to the state of the country's kretek cigarette exports to the United States was the biggest one compared to that exported to other countries. Therefore, the ban reduced Indonesia's income from kretek exports significantly, he said.          According to the Ministry of Trade, exports of various kinds of cigarettes to the US in 2007 reached US$11,165,432 and dropped to US$9,703,991 in 2008 and US$8,338,419 in 2009.          The realization of exports of the product from January to March 2010 reached US$2,531,317 higher than in the same period last year that was recorded at US$2,531,989.          During the period however no exports of cigarette tobacco that include clove cigarettes were done. This happened following the implementation of the Family Smoking Prevention and Tobacco Control Act as of September 2009.          The law prohibits sale of all kinds of flavored cigarettes including clove cigarettes in the US except menthol cigarettes.          The Indonesian government has asked the WTO to solve its dispute over the ban of its kretek exports to the United States. Washington has banned the commodity's imports based on its health law which also prohibited the importation of other aromatic cigarettes in an effort to prevent youths from being addicted.          Indonesia has previously taken the ban to Dispute Settlement Body of the WTO with regard to the imposition of the Family Smoking Prevention and Tobacco Control Act of 2009.          The Indonesian government considers the law running against the WTO regulation because it exempts menthol cigarettes while menthol and clove cigarettes are like products according to Article 2.1 of the Agreement on Technical Barriers to Trade or TBT Agreement.          Around 99 percent of clove cigarettes sold in the US are imported from Indonesia while all menthol cigarettes are produced in the US and because of that, according to the Indonesian government, the US implicitly bans imports of clove cigarettes.          The government considers the ban discriminative. As a member of the WTO,  the US must have carried out its international obligation as mentioned in the TBT Agreement and the General Agreement on Tariff and Trade or GATT of 1994.          The director general of international trade cooperation of the ministry of trade, Gusmardi Bustami, said the move to take the matter to the WTO dispute settlement body was the last resort. He said the government has already expressed its opposition to the regulation while it was still being discussed at the US Congress.          Indonesia, he said, has also conveyed its complaint in various bilateral forums at senior official and ministerial levels for more than four years but it had come to no avail.          "This is about principles. There has been discrimination," Gusmardi said.          In the DSB WTO meeting on June 22, 2010 in Geneva, the Indonesian delegation conveyed reasons and legal basis for the need to form a panel to deal with the problem.          He said Indonesia had asked the panel to investigate the violation by the US against Article III of the GATT of 1994 and the use of Article XX of GATT 1994 without providing scientific evidence and meeting the provisions in a number of articles in the TBT and Sanitary and Phythosanitary Act (SPS).          In the meeting the US delegation expressed disappointment over the Indonesian move.          The US has asked Indonesia to reconsider its request for the establishment of a panel to investigate the case.          Gusmardi said the rejection by the US was common, had often happened in a DSB meeting because the US as a disputed party has a right to block the move on the first occasion in line with the WTO's provision on Dispute Settlement Understanding.***2*** (T.A014/H-NG/H-YH) 01-07-2010 22:46: