Indonesia Announces Increase in Retail Selling Prices for Conventional and Electric Cigarettes in 2025

Directorate General of Customs and Excise Cites Health Control and Downtrading Mitigation as Key Considerations

The Directorate General of Customs and Excise (DJBC) of the Indonesian Ministry of Finance has announced that the retail selling prices (HJE) for conventional and electric cigarettes will increase in 2025. Director General of Customs and Excise Askolani stated that this move is part of the government’s strategy to manage cigarette excise policy without raising the Tobacco Excise (CHT) tariff.

During an APBN KiTa press conference in Jakarta on Wednesday, December 11, 2024, Askolani mentioned that the legal framework for the cigarette price increase will be the Minister of Finance Regulation (PMK), which is scheduled to be issued this week. Two separate PMKs will be released, one for conventional cigarette HJE and another for electric cigarette HJE, which will serve as the policy foundation for 2025.

Strategic Considerations Drive Decision to Raise Cigarette Prices

Askolani highlighted several strategic considerations that underpin the decision to increase cigarette prices, including health control measures, which represent a major step by the government in regulating tobacco products. The government also aims to mitigate downtrading that occurred during 2024 and minimize its impact in 2025, while taking into account the industry’s workforce.

Coordination with Perum Peruri for New Cigarette Excise Stamps

The Customs and Excise authorities have coordinated with Perum Peruri to print new cigarette excise stamps for 2025. Askolani stated, “We have prepared the contract with Peruri, and Peruri has also prepared the facilities, infrastructure, and raw materials for printing 2025 excise stamps. We hope that in the near future, Peruri can start preparing and fulfilling the excise stamps in December.”

Askolani predicted that the demand for excise stamps will increase significantly in December this year and reach its peak in January next year, with an estimated 15-17 million excise stamps required.

As Indonesia moves forward with its plan to raise the retail selling prices of conventional and electric cigarettes in 2025, the government aims to balance health control measures, mitigate downtrading, and consider the industry’s workforce. The issuance of new Minister of Finance Regulations and coordination with Perum Peruri for excise stamp production mark important steps in implementing this policy change.

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