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Jakarta Post

Economy in brief: Cigarette VAT raised to 9.1 percent

  • The Jakarta Post

Jakarta   /   Sat, January 7 2017   /  12:26 am

The government has pushed up the value-added tax (PPN) on cigarettes to 9.1 percent this year as part of its gradual effort to increase the rate to 10 percent, a number that already applies to other consumer goods.The raised tax, which is up from 8.7 percent last year, has been effective since Jan. 1, according to Finance Ministerial Regulation No. 174/PMK 03/2016.The Association of Indonesian Light Cigarette Producers (Gaprindo) has protested the new measure as the rise breaches the government’s agreement with industry players.Earlier, both approved of the rate at 8.9 percent for this year and 9.1 percent for next year, said the group’s chairman Muhaimin Moefti as quoted by Kontan on Friday. The government, in this case, showed its inconsistency in making its policy, he added.So far the group’s members had no choice but to comply with the rules, although they might have further di...