despite current reports on plans of the Indonesian government to raise cigarette prices, Finance Minister Sri Mulyani Indrawati said the ministry n has not yet finalized the decision.
Recently, Minister Indrawati revealed that the new cost of cigarettes will most likely be decided before the deliberation of the government on the state budget next year.
In response to the overwhelming reaction of people to higher prices, the Minister Indrawati has made clear that the Ministry of Finance has yet to proceed with the plan:
" starting today, the Finance Ministry has not yet issued any new decision on whether the price of cigarettes at retail or excise duty on cigarettes, "said the minister as reported by the Jakarta post .
The rumors about price increases have indeed sparked outrage producers. The PT Gudang Garam director, one of the largest cigarette manufacturers in Indonesia, for example, said that the plan could bring damage to the tobacco industry:
"If the government decides to go ahead with the plan, I think it will wreak havoc in the industry, "said Sidharta Istata Taswin as reported by Tempo.
Similarly, head of the Indonesian cigarette factory Union (GAPRI) Ismanu Soeriman insisted that the rumors are false because cigarettes contribute a significant amount of revenue for the country:
"We condemn the information. It is a hoax."
plans to increase the price of cigarettes was originally based on a study conducted by Hasbullah Thabrany, head of economic research and policy health, School of public health, University of Indonesia.
The results suggest that a person stops smoking if the price of cigarette is doubled, so therefore the solution was to increase the cost.