The Rise of Cheap Cigarettes due to Increased Tax

Consumers are downtrading their cigarette choices as tax rates rise, leading to an increase in cheap cigarettes and a persistent smoking prevalence. 

Khairul Anam

August 12, 2024

THERE is a noticeable shift in cigarette consumers as tax rates continue to climb. While seven years ago, cigarette smokers favored premium brands that fell into excise Class I, they are now turning to lower Class II and III brands produced by smaller manufacturers.

This shift in consumer behavior was highlighted in a public presentation by HM Sampoerna at the end of July. At that time, Chief Executive Officer (CEO) Ivan Cahyadi noted

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