Indonesian E-cigarette Association Aims for 6% Sales Growth

According to a report by Bisnis on May 30th, the Indonesian Personal E-cigarette Association (APVI) aims for sales growth of over 6% this year, thanks to the Finance Ministry's target of setting a Tobacco Product Consumption Tax (CHT) for the e-cigarette sector at 2 trillion Indonesian rupiahs.

APVI President Budiyanto has stated that he is optimistic about achieving the goals of the CHT and the sales of e-cigarettes, as consumption is steadily increasing year by year. Additionally, the current number of e-cigarette consumers has reached 6 million users.

On Wednesday, Budi stated during a meeting at the Jakarta Casablanca Hall: "Currently, sales growth is around 5%-6%. However, our target for this year is even greater, as the goals set by the customs and tax department must exceed 20 trillion Indonesian Rupiah (approximately $1.2 billion).

This positive attitude is supported by the achievements made last year, with the achievement expected to reach 175 trillion Indonesian rupiah (approximately 1 billion US dollars) in 2022, higher than last year's 100 trillion Indonesian rupiah (61.5 million US dollars). Additionally, earlier this year, Budhi stated that consumer tax purchases had exceeded 100 billion Indonesian rupiah (61.5 million US dollars).

Nevertheless, he did not deny that achieving this goal will be a challenge with both the CHT and taxes increasing by 10%. Buddi stated that sales are still growing, but the growth in value is limited.

He said, "I hope this proves that the market is growing, but if illegal cigarettes continue to be widespread, then this market will not grow significantly and will have an impact on the industry.

Earlier, entrepreneurs claimed that the e-cigarette tax scheduled to take effect on January 1, 2024, could be the industry's third major blow.

Garindra Kartasasmita, Secretary General of the Indonesian Personal E-Cigarette Association (APVI), previously stated that the emerging industry has been burdened by a 15% increase in consumption tax and a rise in retail prices (HJE), leading to an increase in value added tax burden.

Imposing cigarette taxes on e-cigarettes is the third blow to the e-cigarette industry in 2024," said Galindra.