Excise Tax on Sweetened Drinks Set if Economy Grows Above 5% in 2023

JAKARTA. The plan to impose an excise tax on packaged sweetened drinks (MBDK) depends on economic conditions in 2023. If economic growth in 2023 is above 5%, the MBDK tax will be implemented.

The plan is to set the MBDK excise tax rate at a moderate level. Thus, it will not impact the Indonesian economy or the industrial world too much.

Quoting Kontan.co.id, in its determination, the government also considers the amount of MBDK excise tariffs in other countries, especially countries in the Southeast Asian region. 

In the ASEAN region, there are already seven countries that impose MBDK excise, including Laos, Cambodia, Malaysia, Thailand, Brunei Darussalam, the Philippines, and Timor Leste.

For information, the excise tax on MBDK in Laos and Cambodia is quite extensive, as it includes carbonated drinks, concentrates, energy drinks, 100% fruit juices, sweetened juices, milk-based drinks, low-calorie sweetened drinks, and unsweetened bottled drinking water.

The amount of MBDK excise tax imposed in Laos is 5%-10% per litre. While Cambodia applies an MBDK rate of 10% per litre.

Then, Brunei only applies MBDK excise on carbonated and energy drinks at a rate of 0.4 BND for sugar limits above 6 grams per 100 ml.

In Malaysia, MBDK excise is imposed on carbonated drinks, concentrates, energy drinks to milk-based, at a rate of 0.4 MYR per litre for sugar limits above 5 grams per 100 ml. 

Thailand imposes MBDK excise on beverages with sugar limits above 6 grams per 100 ml at a rate of 10-14% + 0.1-5 THB per litre.

The Philippines applies the MBDK excise tax only to carbonated drinks, concentrates, energy drinks, sweetened juices, and low-calorie drinks at a rate of 6-12 PHP per litre. Meanwhile, Timor Leste applied the excise tax on MBDK in 2023 at US$3 per litre. (ASP/KEN)