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Plastic, sweet beverage excise to cause more problems than it solves: Businesses
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Sweet but dangerous: New research suggests that sugar found in sweetened beverages could increase the risk of type 2 diabetes more than sugar found in other foods. (Stockrez-art via AFP Relaxnews /-)
I
ndustry players have complained about a planned excise tax on plastic products and sweetened beverages, arguing it will not solve what it is intended to and will cause other problems in the process.
Indonesian Olefin, Aromatic and Plastic Industry Association (Inaplas) secretary-general Fajar Budiono told The Jakarta Post on Monday that the levy on plastic would stoke inflation, because most products incorporated plastic, one way or another.
“This won’t solve anything. It will [instead] cause new problems,” said Fajar.
Consumers would bear the burden of the higher product costs, while micro, small and medium enterprises would be hit the hardest, as they were the biggest users of plastics, said Fajar. Packaging currently accounted for around 5 percent of product prices, Fajar said, estimating that the levy would drive that up to 10 or 15 percent.
He went on to claim that the excise would entirely reform the plastic industry landscape and predicted that most producers would shift to trading as their core activity, which would result in greater plastic product imports.
“Food and beverage producers might then not produce here. They would relocate to another ASEAN country, for instance to Johor Bahru [in Malaysia] and [import] through Batam. That [would be] cheaper,” said Fajar.
