Moeldoko: Excise On Tobacco Products Rises Because Smokers Are The Biggest Contributor To BPJS

Moeldoko's Presidential Chief of Staff in Bali/FOTO Dafi VOI

DENPASAR - The government will increase the excise rate on tobacco products (CHT) aka cigarette excise starting next year. Presidential Chief of Staff Moeldoko said the increase in CHT was routine every year.

"I think that cigarette excise tax increases every year. So this is not something new, and it repeats itself from year to year. Indeed, there may also be complaints," said Moeldoko at the Bali governor's office, Thursday, December 16.

According to Moeldoko, smokers are the biggest contributor to the burden on the Health Social Security Administration (BPJS).

"According to the results of a survey conducted, smokers are the biggest contributor to the burden on BPJS. For that, the hope is that it will reduce smokers and automatically BPJS costs will be lighter," he added.

Moeldokok hopes that the increase in CHT can also make the younger generation aware of their health.

"Then the second generation is easy for us to have more high awareness of health. For that we can reduce (smokers) approximately," he said.

Previously, the government through the Ministry of Finance (Kemenkeu) said it would continue to increase its commitment to suppress cigarette consumption. Recently, the Minister of Finance (Menkeu) Sri Mulyani said that the Tobacco Product Excise (CHT) policy was part of efforts to achieve this target.

"The government is pushing to improve the quality of public health as well as increasing the productivity of human resources in the future," he said in a virtual press conference, Monday, December 13.

According to the Minister of Finance, the CHT policy so far has been effective in suppressing cigarette consumption, as reflected in the decline in cigarette consumption in 2020 by 9.7 percent from the previous year in line with the increase in the price index of cigarettes by 12.6 percent.

In his explanation, efforts to reduce the disparity in cigarette prices across all types of cigarettes are also important to increase the effectiveness of the CHT policy.

"While the consumption of machine-made cigarettes, both kretek cigarettes (machine-made kretek cigarettes/SKM) and white cigarettes (machine white cigarettes/SPM) continues to decline in line with price increases due to CHT tariff adjustments," he said.

Meanwhile, the consumption of cigarettes made by hand (hand-made kretek cigarettes) has actually increased in the last 2 years because the excise rate has not increased, which makes the price more affordable. The absence of an increase in SKT types in 2020 is related to a policy transition that pays attention to the sustainability of the workforce, especially tobacco farmers and workers in the tobacco industry in general.

“To increase the effectiveness of CHT in order to support efforts to reduce cigarette consumption, the tariff increase will also include SKT which will also be accompanied by the CHT Profit Sharing Fund (DBH) policy. Through DBH CHT, the government is trying to increase support for tobacco farmers/laborers and cigarette workers," he said.