Riri Rahayuningsih, Jakarta – Indonesia's House of Representatives' Budget Committee has backed the government's plan to impose an excise on packaged sugar-sweetened beverages starting in 2027, after the policy was repeatedly postponed.
Said Abdullah, chair of the House Budget Committee, said the excise should be implemented next year as the government seeks to increase state revenue while maintaining fiscal discipline.
"If it is postponed again, state revenue alone will increase by almost Rp400 trillion. Where will it come from? The commitment of the Budget Committee and the government is to maintain the deficit," Said told reporters after a meeting with the government at the House complex on Thursday, September 24.
The government and the Budget Committee agreed on a state revenue target of Rp3,435.1 trillion in the 2027 draft state budget, or RAPBN. The figure is part of a budget framework that targets a fiscal deficit of 2.4 percent of gross domestic product.
The revenue target includes Rp2,911 trillion in tax revenue, comprising Rp2,593 trillion in tax receipts and Rp318 trillion in customs and excise revenue. Non-tax state revenue is targeted at Rp522.48 trillion.
The sweetened beverage excise is expected to contribute about Rp1.6 trillion to the 2027 state revenue target, according to recent budget discussions.
Sweetened beverage excise has been delayed since 2019
Plans to impose an excise on packaged sugar-sweetened beverages have been under discussion since 2019 but have repeatedly been postponed.
Finance Minister Suahasil Nazara declined to provide details when approached by reporters after Thursday's meeting.
"Details later," Suahasil said.
The latest budget agreement indicates that the excise is being incorporated into the 2027 revenue framework, although the draft budget still has to proceed to the House plenary session for final approval. The government and the Budget Committee agreed to continue deliberations on the 2027 state budget at the plenary meeting scheduled for September 29.
Former Finance Minister Purbaya Yudhi Sadewa previously said the excise could be introduced once economic conditions were stronger.
"If the economy is struggling, why would I tax it? But once it is strong, I will impose it. It should indeed be taxed," Purbaya said on September 7, as quoted by Antara.
Calls for the excise to be implemented
One group calling for the government to introduce the excise is FAKTA Indonesia, or the Urban Citizens Forum.
FAKTA Indonesia chairperson Ari Subagyo Wibowo said the prolonged delay was no longer merely a matter of policy choice. He argued that it amounted to government inaction in fulfilling what he described as constitutional and legal obligations.
The proposed excise is part of broader efforts to increase state revenue, with the government and the Budget Committee seeking to raise revenue while keeping the 2027 fiscal deficit at 2.4 percent of GDP.
Source: https://en.tempo.co/read/2120310/indonesia-to-impose-sweetened-beverage-excise-in-202