Government Urged to Impose Higher Taxes on Packaged Sweetened Beverages for Public Health Concerns

Government Urged to Impose Higher Taxes on Packaged Sweetened Beverages for Public Health Concerns

The Indonesian People’s Consultative Assembly (DPR) is strongly advocating for the Directorate General of Customs and Excise within the Ministry of Finance to take decisive action by imposing substantial taxes on enterprises engaged in the production of Packaged Sweetened Beverages (PSB).

Mukhamad Misbakhun, a respected member of Commission XI, has brought to light the highly detrimental effects of Packaged Sweetened Beverages on public health, including the alarming rise of obesity and the associated environmental pollution concerns. Hence, Misbakhun is fervently urging the Government to enforce a robust taxation regime for businesses involved in PSB production.

Addressing the issue from Jakarta on Tuesday (15/8/2023), Misbakhun underlines the urgency of levying substantial taxes on PSB due to its profoundly adverse influence on the overall health and well-being of the population.

Anticipating a significant policy shift, Misbakhun hopes that the discussions on implementing higher taxes on PSB will feature prominently during the forthcoming presentation of the Government’s financial blueprint for 2024 in the DPR. Significantly, Misbakhun underscores that the DPR has already provided its explicit endorsement to the Government’s plan to promptly introduce this crucial regulatory measure.

“In the Financial Note that will be presented by the President, we expect to see the inclusion of this provision since it no longer necessitates the approval of the DPR, given that our consent has been granted,” he elaborates.

In a notable move, the Government had earlier confirmed its intentions to initiate the imposition of taxes on every Packaged Sweetened Beverage (PSB) from the upcoming year, 2024.

Offering further insights, Askolani, the Director-General of Customs and Excise within the Ministry of Finance, elucidates that the taxation framework for PSB will be distinct in nature, specifically omitting the band scheme commonly associated with cigarette taxes. This, he asserts, reflects a well-considered approach to addressing the unique nature of PSB products.

“The PSB tax framework will diverge from the band scheme. As we communicate the forthcoming policy on PSB, our aspiration is for its implementation to effectively take shape, ideally commencing in the year 2024,” Askolani affirms during the press conference held on Friday (11/8/2023) centered around the national budget (APBN Kita).