Vape Entrepreneurs Ask For The Implementation Of Electronic Cigarette Taxes Postponed, Ministry Of Industry Says This

The Association of Indonesian National Vapes (Pavenas) asked the Ministry of Finance (Kemenkeu) to postpone the implementation of the electric cigarette tax until 2027.

"Pavenas juga mendorong pemerintah untuk transparan dan berlaku adanya dalam perumusan kebijakan dengan melibatkan langsung pelaku usaha," kata Sekretaris Jenderal APVI Garindra dalam keterangan resminya, dikutip Rabu, 27 Desember

Garindra said the plan to impose an electric cigarette tax coincided with an increase in excise tax, which was a major blow to entrepreneurs, consumers, and industry players.

With the plan to impose an e-cigarette tax of about 10 percent of the applicable excise rate, plus an increase in excise rates for electronic cigarettes by 15 percent, e-cigarettes will receive an increase in tax expense by more than 25 percent in 2024.

Responding to this, the Ministry of Industry (Kemenperin) stated that regulations regarding e-cigarettes or vapes are still in the discussion stage. Governance is needed in line with the massive development of e-cigarettes.

Acting Secretary General of the Ministry of Industry Putu Juli Ardika assessed that legal certainty and regulation are one aspect that is able to increase the Industrial Trust Index (IKI), especially for e-cigarettes that are in the processed tobacco products sector.

Based on data from the Ministry of Industry, IKI for processed tobacco products as of December 2023 recorded a figure of 57.64, up from 50.79 in November 2023. In fact, this figure increased significantly from October 2023 which was at a negative level.

"Why is it so good? Because lastly, many laws and regulations have been discussed and found solutions that are quite conducive to all parties, both for health, industry and related sectors," Putu said in a year-end media meeting monitored online, Thursday, December 28.

"What is clear is that we need to regulate, there are regulations for e-cigarettes and this is being discussed," he continued.

In addition to e-cigarettes, Putu emphasized that his party as the government's representative would eradicate illegal cigarettes.

This commitment aims to provide equal certainty and treatment (playing field).

"And the most prominent thing to do next is to eradicate illegal cigarettes. This is very important to provide certainty and equal treatment (playing field) so that they are not disturbed by e-cigarettes," he said.

Thus, Putu welcomed if later the government postponed the implementation of the electric cigarette tax.

Bearing in mind, Putu continued, the export growth of tobacco products is quite high, reaching 17.26 percent.

Then, most of the increase (due to exports) of e-cigarettes, mainly to the United States.

"If indeed the results of the discussion and it is agreed by the government that it will be postponed, yes, maybe it will be even better. But, what is clear is that we need to regulate this e-cigarette," he concluded.