Indonesia: No Tax on Plastic Bags Next Year -- Finance Minister

Tabita Diela Jakarta Globe 27 Oct 16;

Jakarta. Indonesia is pulling the brakes on its plastic bag excise, Finance Minister Sri Mulyani Indrawati said on Thursday (27/10).

"No new excise is going to be imposed in 2017," Sri told reporters at a Jakarta Foreign Correspondents Club meeting.

Earlier, the government was planning to tax plastic bags to increase state revenue and reduce plastic consumption.

Indonesia imposes excise on tobacco products, alcoholic beverages and ethyl alcohol to reduce consumption of these products and monitor their circulation.

"There are concerns coming from the parliament and business community, so I will be pragmatic and [say] I will look at them," Sri said.

Despite canceling the plan for the plastic bag tax, the government's newly passed 2017 state budget mandates a higher revenue from excise.

The Finance Ministry's directorate general of customs and excise aims to collect Rp 157.2 trillion ($12 billion) for the state coffers next year, 6.1 percent more than it planned to collect this year.

The government has so far collected Rp 81.9 trillion in excise this year, or 56 percent of the 2016 revised state budget target, according to the directorate's website.

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