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Indonesia hikes tax on tobacco

Anti-tobacco campaigners have given their approval to the Indonesian government’s decision to raise tobacco taxes.

Jakarta announced an increase in tobacco excise by an average of 8.5% on Tuesday, effective next year.

It is hoped that higher taxes, which will boost government revenue, will encourage smokers to quit in a nation where 67% of men aged 15 ormore smoke and about a quarter of boys aged 13 to 15 are also hooked on nicotine.

“We welcome the government’s plan,” Tubagus Haryo Karbyanto, chief campaigner for the National Commission on Tobacco Control (Komnas PT), told the Jakarta Globe.

“Our cigarette prices are so low that even children can afford to buy them. That’s why the smoking epidemic is so massive.”

Cigarettes cost about US$1 a pack in Indonesia, far less than in neighbouring countries such as Malaysia and Thailand, where a pack costs US$3 to US$4. Indonesia’s excise on cigarettes, currently less than 40%, is also low by regional standards.

Indonesia is one of the world’s largest cigarette-producing countries. The tobacco industry employs millions of Indonesians and about 6% of government revenue is raised from tobacco taxes. Indonesia also has a powerful tobacco lobby that actively campaigns against regulations that could reduce sales.

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