Deputy III of the Presidential Chief of Staff Edy Priyono noted in a written statement received here Saturday that the effort was aimed at anticipating the impact of global economic uncertainty on the tobacco industry in Indonesia.
"The social protection will be realized in various programs, such as the provision of fertilizer assistance, agricultural machinery for production or post-harvest, and direct cash assistance," Priyono remarked.
The social protection effort also aligns with the results of a coordination meeting involving the Presidential Staff Office, Ministry of Finance, Ministry of Agriculture, Ministry of Home Affairs, and as many as 77 local governments, at the provincial, district, and city level.
Currently, the Directorate General of Fiscal Balance at the Ministry of Finance issued a letter regarding the use of the 2023 DBH CHT. The letter is addressed to regional governments receiving the DBH CHT as program planners and executors, Priyono stated.
As a follow-up to the program, local governments must actively disseminate information on the use of social protection programs for farmers and tobacco industry workers in their respective areas.
Priyono expressed optimism that tobacco farmer associations would also be involved in a program to strengthen social protection through collaboration with their respective local governments. "We hope that the program would be in accordance with the characteristics of each region," he remarked.
According to the mandate of the Minister of Finance Regulation Number 215 of 2021, three percent of the tobacco excise revenue is allocated as a profit-sharing fund managed by the producing regional government.
Baca juga: Ban on single cigarette sticks' sales to protect public
Baca juga: MSMEs still backbone of national economy
Of the revenue-sharing funds, as much as 50 percent must be used to improve the people's welfare, while the remaining 40 percent will be used for health, and 10 percent for law enforcement, he explained. "The policy of increasing excise rates on tobacco products must also have an impact on the welfare of farmers and workers," he emphasized.
The government had earlier decided to increase the tobacco product excise rate (CHT) by 10 percent during the 2023-2024 period. The policy considers various aspects that encompass controlling cigarette consumption, labor welfare, state revenues, and monitoring of illegal cigarettes.
