Indonesia delays sugary drinks tax (Photo:AFP/VNA) Jakarta (VNA) – The Indonesian governmenthas once again delayed the implementation of the long-awaited excise tax onsweetened beverages, raising questions over its commitment to improving postCOVID-19 pandemic public health.
In 2022, the Finance Ministry and the House ofRepresentatives Budget Committee (Banggar) agreed to include taxes on sweetenedbeverages and plastic products in the 2023 state budget, though FinanceMinister Sri Mulyani said implementing the excise fees would largely depend onthe pace of recovery in 2023.
Nirwala Dwi Heryanto, director for communication atthe ministry’s customs and excise directorate general, said it was unlikelythat the plan to tax sugary beverages could be implemented this year as theministry was still in the process of completing the legal requirements toimpose the excise.
He acknowledged that officials are currently planning to draft a governmentregulation as a legal basis to tax sugary drinks while considering the momentumof the country’s economic recovery. The ministry is planning to propose theexcise tax to the House Commission IX overseeing health in May. If all goeswell it may be in effect next year.
The Finance Ministry had been entertaining since 2009 the idea of taxing sugarydrinks to diversify revenue sources but progress had been slow, mainly due toresistance from businesses.
In 2020, the ministry again proposed imposing a sugary drink tax with a moredetailed scheme, but the proposal was denied by lawmakers due to the economicslump during the COVID-19 pandemic.
The government’s sluggish progress to implement a tax on sugary beverages hasraised questions over its commitment to improving public health,especially amid the Health Ministry’s ongoing effort to reform the healthcaresystem following the devastating impact of the COVID-19 pandemic.
Health Minister Budi Gunadi Sadikin penned a ministerial regulation in Julythat instructed regional administrations to follow a national healthcaretransformation blueprint that prioritised illness prevention, rather thantreatment.
As part of the preventative efforts, the ministry is expanding the nationalchildhood immunisation programme, offering free screenings for 14 common deadlyillnesses healthy lifestyles for Indonesians.
But the ministry’s noncommunicable disease control (NCD) and prevention director EvaSusanti has said that these efforts alone were not sufficient to curb thecountry’s growing NCD problem, and that fiscal policy was needed to control theconsumption of unhealthy foods to prevent the disease.
Sasanti highlighted that the ministry needs to optimise efforts by pushingmanufacturers to reformulate their products so they have lower levels of sugar,salt and fat, such as by imposing an excise on sweetened beverages./.
