The Ministry Of Industry Calls The Production Of The Drink Industry Down Due To The Excise Implementation Plan In 2025

JAKARTA - The Ministry of Industry (Kemenperin) said that the beverage industry, especially packaged sweetened drinks, began to experience a decline in production.

Spokesperson for the Ministry of Industry Febri Hendri Antoni Arif said that this decline was caused by a plan by the Ministry of Finance (Kemenkeu) which would apply excise on Packaging Contained Drinks (MBDK).

"Based on IKI August 2024, we observe that the beverage industry has decreased slightly in production this month. Even though it is still small, we see that the beverage sub-sector is starting to respond to the implementation of packaged sweetened beverage excise," said Febri, quoted on Friday, August 30.

It is known, the government has limited levels of sugar, salt and fat (GGL) in food and beverage products through Government Regulation (PP) Number 28 of 2024 concerning Implementation Regulations of the Health Law.

In addition, the government targets excise revenues to increase by 6 percent in the 2025 RAPBN financial note, to Rp 244 trillion. One of the efforts made is through limited excise extensification of packaged Beverage Products (MBDK).

The implementation of excise duty on MBDK will be implemented in 2025. However, this policy has invited a number of protests from the public, especially among beverage entrepreneurs in Indonesia.

Previously, Chairman of the Association of Indonesian Food and Beverage Entrepreneurs (Gapmmi) Adhi S Lukman said the implementation of packaged Beverage Excise (MBDK) would have an impact on an increase in product prices of up to 30 percent.

This seems to dismiss the statement by the Director General of Agro Industry at the Ministry of Industry (Kemenperin) Putu Juli Ardika who said that the application of sweetened beverage excise of Rp. 1,771/liter will have the potential to raise product prices by around 6-15 percent.

Adhi also denied the calculation. According to him, the increase experienced would be higher than that calculation.

"More than 6-15 percent) if it's IDR 1,700 per liter. It means that 350 milliliter drinks are usually the most (meaning in the market), meaning (tax) IDR 1,700 divided by 3, yes, around IDR 600 per bottle," said Adhi when met after the Asia Indonesia Food Ingruents press conference at Artotel Gelora Senayan, Jakarta, Monday, August 19.

He said, a tax of Rp600 per bottle is a rough calculation for the increase in prices from factories, not the price that will be charged to consumers. Meanwhile, the price increase when it reaches consumers can swell.

According to him, the price increase in factories could reach 20 percent, but when it reaches consumers, the end of the increase can be at 30 percent.

For example, the price of products per bottle at the factory of Rp. 3,000 when it reaches consumers will be Rp. 5,000. This amount has not been added to VAT of around Rp. 600.

"When (tax) is Rp600 from Rp3,000. This means that the price will increase by 20 percent. That is an extraordinary increase. If it reaches the final consumer (the increase) can be up to 30 percent, very expensive," said Adhi.