She went on to implore the government to reconsider its decision as she said it would directly impact her family’s livelihood.

“My husband just got fired from his job. I now serve as my family’s sole breadwinner. I’m afraid that [Sampoerna] would let go some of its current employees because it could no longer pay us after the steep excise hike. Fewer people would buy cigarettes because of it. I’ll probably be laid off,” Siti said during a workers’ rally in Surabaya on Tuesday.

Ira Sukira, a fellow cigarette worker with 28 years’ experience, shared Siti’s concern, demanding that East Java Governor Khofifah Indar Parawansa convey the workers’ pleas to President Joko “Jokowi” Widodo.

Like Siti, Sukira also rolls kretek (clove-blended cigarettes) for a living.

“We urge the government to protect workers at hand-rolled clove cigarette [SKT] factories. We hope the excise hike for SKTs would be less steep than that for machine-rolled clove cigarettes [SKMs],” she said.

Siti and Sukira were among thousands of female cigarette hand-rollers — most of whom are mothers and wives — joining the workers’ rally around the Surabaya Submarine Monument on Jl. Pemuda. Besides the rally, the women also ran an environmental campaign where they gave away plants and eco-friendly reusable bags to passersby.

The rally was meant to convey the workers’ collective concern over the already grim outlook of the SKT market. Market preference for SKTs has shrunk over the years, currently accounting for only 17 percent of the domestic cigarette market. Employees of tobacco companies, including Sampoerna, are afraid that the announced 23 percent excise hike would only result in fewer sales, therefore, putting workers at risk of being laid off.

Participants of Tuesday’s rally, most of whom were Sampoerna employees, demanded that the government be more lenient toward the increasingly niche SKT market and only increase excise for the product by 5.75 percent, or a quarter of the proposed 23 percent.

“[Lowering the SKT excise] will save the future of our livelihood. We sincerely ask the President not to impose the same hike on the SKT segment,” Sukira said.

Sampoerna spokesperson Troy Modlin concurred that such a drastic hike would affect the industry. He went on to say that the ideal excise increase should be 10 to 11 percent this year.

“PT HM Sampoerna Tbk has not yet seen the details of the proposed excise regulation. However, it was unexpected and will definitely disrupt the tobacco ecosystem. If the government intends to implement an excise policy that can support continued industry employment, we suggest that existing tax loopholes for machine-made products are immediately closed and current production thresholds for hand-rolled products remain unchanged,” Modlin said in a statement.

Indonesian Tobacco Society Forum chairman Heri Susanto echoed Modlin’s sentiment, saying that the government should immediately impose a cap on the collective production of SKMs and machine-rolled cigarettes (SPM) since the established excise mechanism for both products was riddled with loopholes that many international tobacco companies had exploited to evade local tax.

“Producers of Type 2 SPM and SKM have managed to evade the obligation of paying higher tax since they had kept production below the regulated amount at 3 billion cigarettes. It’s simply unfair, especially considering that the collective excise for Type 2 SPM and SKM is 50 to 60 percent lower than Type 1,” Heri said, referring to the two tiers of tobacco excise.

He went on to say that limiting machine-rolled cigarettes would contribute to higher state income.

There are around 67,000 human cigarette rollers working for Sampoerna to date, or 75 percent of the country’s cigarette rollers. SKMs currently reign over 78 percent of the domestic cigarette market. Meanwhile, market preference for hand-rolled and machine-rolled cigarettes has shrunk to just 17 percent and 5 percent, respectively. (rfa)

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