The Impact of Cigarette Price Hike for Industrial Workers

22 August 2016 | Author : Manufakturindo
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The discourse of cigarette price hike up to IDR 50.000 per pack reap some pros and cons from various circle. At this time, the cons came from the President of the Federation of Indonesian Metal Workers Union (FSPMI) / Indonesian Trade Union Confederation (KSPI), Said Iqbal. He said there are several reasons they rejected the increasing of cigarette prices.


First, the cigarette price hike is potential in reducing the society purchasing power to buy cigarettes. The impact is, the tobacco industry should lower their production, and then a massive layoffs of workers in the tobacco industry is inevitable.


"Moreover, 80 percent of workers in the tobacco industry is outsourced workers who have decades in working and vulnerable by layoffs. Workers agreed that health is a priority, but every government policy should comprehensively consider the matter of employment," said Said Iqbal, Monday (22/8 ).


Second, with the cigarette price hike, it is predicted to add new unemployment numbers to 4.7 million workers and 1.2 million tobacco farmers.


"The government should not only demanding the the additional funding by cigarette tax, but never think about the tobacco industry workers, and tobacco farmer’s children and their families," said Said Iqbal.



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Third, the expensiveness ofa legal cigarettes will not succeed to suppress consumption of smokers, because it will bring cigarette smuggling and illegal cigarettes sale cheaply. "We know that the government oversight is weak and corrupt bureaucrats mentally still strong," added Said Iqbal.


Fourth, by increasing cigarettes’ price by the government means sucking the blood" of little people for raising trillions revenue of cigarette taxes.


Therefore, KSPI argued that the right method is not to raise the price of cigarettes but to strengthen the education and campaigns about the dangers of smoking, especially among the younger generation, as well as raising the maximum income tax from businessman of cigarette industry.


"In fact, tobacco companies possessors are the richest number 1 and 2 in Indonesia, while their labor is paid with cheap labor and employ 80 percent of the labor by outsourcing," said Said Iqbal.


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