Indonesia Levies 57% Excise Tax On E-Cigarettes

The government of Indonesia has imposed a 57 percent excise tax on all electronic cigarette devices sold in the country.

The decision to impose the tax, which was decided upon on January 1, 2018, comes as a result of what the Indonesian government claims to be health concerns and the threat of the illegal e-cig trade. The decision, they claim, was made with the electronic cigarette industry and consumer purchasing power in mind.

This newly imposed tax is scheduled to go into effect on July 1, 2018.

Indonesia is by no means the only country to impose on excise tax on electronic cigarettes, as at least four other countries have imposed similar taxes on e-cigs. These four countries include Russia, South Korea, Portugal, and Greece.

Excise Tax Rates

Here’s a list of the aforementioned four countries and their excise tax rates, as well as Indonesia’s.

  • Russia – 81.2%
  • Portugal – 62.9%
  • Indonesia – 57%
  • South Korea – 16.7%
  • Greece – 13.5%

Based on these numbers, Indonesia’s excise tax on e-cigarettes is by no means the highest as it ranks below both Portugal and Russia with Russia being the highest at over 81 percent.

Regardless of how modest it may be in comparison to the e-cig taxes seen in other countries, the Association of Personal Vaporizer Indonesia (APVI) believes that it’s too high and that it could result in the demise of some of the smaller e-cig companies in the country, Indonesia Investments reports.

In Israel, the Israeli government recently imposed a 65 percent tax on the iQOS made by Philip Morris, which, while not an e-cigarette, is a heat-not-burn device that offers a similar smoke-free experience as electronic cigarettes and other forms of vaporizers.

In the United States, the state of Delaware has put in place a new tax on vape juices, also known as e-liquids, which are now being taxed by the milliliter across the state. In New York, the governor has proposed a tax bill which would levy a tax on e-liquids. And in Pennsylvania, the House Finance Committee has voted to repeal a hefty tax on vape shops, one which could save as many as 1,500 jobs.

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