Legal Tariffs for Illegal Cigarettes
Madura cigarette manufacturers support a study on excise rates for Category III cigarettes. But they remain divided over the rate.
President Prabowo Subianto engaged in discussions with leaders of the Indonesian Chamber of Commerce and Industry (Kadin) regarding the excise stamp policy for Category III machine-rolled clove cigarettes (SKM). Adik Dwi Putranto, Chair of East Java Kadin, inquired about the excise stamp policy during a meeting at the Presidential Palace in Jakarta on July 31, 2026.
Finance Minister Purbaya Yudhi Sadewa informed Adik that the government was still evaluating the rate for Category III excise stamps. Purbaya also urged cigarette manufacturers to cease dealing with illegal cigarettes upon the implementation of the new regulation. Adik informed Tempo on September 6, 2026, based on Purbaya's statement that Customs would take action if illegal cigarettes continued to circulate.
This was not the first meeting between East Java Kadin leadership and Purbaya to discuss Category III excise rates; they had previously convened in Surabaya in November 2025. The meeting, attended by several cigarette manufacturers from Madura, East Java, and Customs Director-General Djaka Budhi Utama, saw Kadin present an academic paper titled "Academic Paper on the Proposed New Category Three Excise Tax for SKM Cigarettes."
The 94-page document, authored by Adik and several lecturers from Airlangga University and Trunojoyo University in Bangkalan, East Java, among other institutions, proposed a Category III excise rate between Rp500 and Rp700 (approximately US$0.028-0.039) per cigarette.
Written by urgent.news from Tempo.co English's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
