Excise Increase Would Not Ruin Indonesian Industry

Source from:  tr.itsmyiq.com Mar 25, 2008 03/26/2008

Doubling cigarette excise duties in Indonesia would reduce tobacco consumption, increase GDP, boost workers' annual incomes and create new employment opportunities, according to a report in The Jakarta Post quoting research by the University of Indonesia and the Southeast Asia Tobacco Control Alliance. The research showed that tobacco companies would survive if the excise duty was doubled from the current average of 31 per cent on factory prices. "Our research shows that if the government increased the cigarette tax by 100 per cent, cigarette retail prices would increase by around 26 per cent," Suahasil Nazara, of the UI's Demographic Institute, told reporters at a press conference. "As a result, cigarette consumption would only decline around 9 per cent. This very small number will not necessarily ruin the cigarette industry," Suahasil added. Enditem