“You can’t kill the industry unless there’s a program to absorb the displaced workforce,” Purbaya said, citing concerns over high cigarette excise rates that could lead to mass layoffs.
He stressed that while higher tobacco taxes aim to curb consumption and raise state revenue, they must be paired with worker transition plans.
“Have we prepared a program to address unemployment? No, we haven’t,” he added.
Purbaya emphasized that public awareness about smoking risks is important, but said industry shutdowns without government support are irresponsible.
He plans to assess the condition of the cigarette industry in East Java and examine the growing illegal market, which he says harms legitimate businesses.
Related news: Industry Ministry proposes WRS to spur local tobacco absorption
Meanwhile, the excise rate for 2026 is still under review.
“There’s still time. No decision has been made,” said Deputy Finance Minister Anggito Abimanyu on Thursday (September 18).
During a recent budget meeting with the House of Representatives, the government and lawmakers agreed to raise the 2025 customs and excise revenue target to Rp336 trillion (USD19.7 billion), up from Rp334.3 trillion.
The details of the new tariff will be set following an evaluation of this year’s performance.
Purbaya also revealed the ministry is investigating illicit practices, including counterfeit excise stamps.
He believes that cracking down on illegal activity could significantly boost state revenue.
“If I can fix the counterfeit issue, we’ll generate real revenue. That will help shape my next policy steps,” he said.
Related news: Government's efforts to reduce smoking prevalence not yet optimal
Translator: Resinta Sulistiyandari
Editor: Rahmad Nasution
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