Increased Tobacco Retail Prices and Excise Label Orders

The Directorate General of Customs and Excise has issued Circular No. SE-14/BC/2006 (the “Circular”) to provide the implementation guidelines to be followed to ensure compliance with a series of earlier regulations stipulating increased tobacco retail prices.

Tobacco prices are to increase by 10% on 1 April 2006 based on Minister of Finance (MoF) Regulation No. 16/PMK.04/2006. The Circular lists the formula to be used to calculate the new tobacco price with all figures to be rounded-up to the next 100 Rupiah. It is important to note that tobacco cannot be sold at a price lower than the stated minimum retail price as contained in MoF Regulation No. 17/PMK.04/2006 which amends MoF Regulation No. 43/PMK.04/2005.