Presentation Public Support to Increase Cigarette Price and Excise
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Public Support to Increase Cigarette
Price and Excise to Finance UHC
Hasbullah Thabrany dan Zahrina
Center for Health Economics and Policy Studies
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Background
Prevalence of Smoker
Cigarette Production
and Excise
Deficite of JKN
• 27% in 1995 to
36.5% in 2013
• 1.7% in 1995 to an
estimate of 6.7% in
2015 (Woman).
• from 7.1% in 1995 to
20.5% in 2013 (Young
Smoker).
• 67% Man are smoker
• 217.400 death per
Year
• 222.7 billion sticks in
2005 to 348 billion
sticks in 2015
• IDR 32.6 Trillion in
2005 to IDR 139.6
Trillion
• IDR 330 Trillions
spent for cigarette
• Health Expenditure
IDR 71.1 Trillions
(MoF, 2015)
• JKN covered 65% of
the population
• claim ratios of JKN of
111.5% in 2014 and
115.1% in 2015
• Mobilize Fund from
cigarette excise and
earmarking the
revenue
DO PEOPLE SUPPORT???
9/23/17
2
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Perbandingan Harga Rokok di Negara ASEAN
14
12
10
8
6
4
2
0
Indonesia
Philippines
Vietnam
Thailand
Harga $
9/23/17
Cambodia
Lao DR
Myanmar
Malaysia
Brunei
Timor Leste
Singapore
International dollars (at purchasing power parity)
3
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Objective
•
This study explored the possibility the people’s support in
increasing cigarette prices and exice to meet financial shortage
of the JKN.
• This polling conducted to explore cigarette consumption and
perception of price increase.
9/23/17
4
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Method
Dec
2015
Jan
2016
Phone Survey
Systematic Random Sampling
by the interval of 20.000 of mobile phones numbers.
POLLING
9/23/17
N=1000
5
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Result and Discussion
Respondent Characteristic
1.
2.
3.
4.
5.
Male (61,0%) Female (39,0%)
Average age (32,9) in range 14-78 years old
Education majority graduated high school (50,7%)
Income of Respondent 1 million – 3 million (38,8%)
Occupation distribution; private sector (26,2%), non formal sector (20,9%),
Others (18,6%)
6. 56,5% are JKN Participant
7. 41,5% are smoker
8. Penerima Bantuan Iuran (PBI) (13,2%), PBPU (66,9%), Private
Sector&Governmental Employee (19,9%)
9. Participant who use JKN (2,7%)
10.Came from 34 province
9/23/17
6
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Characteristics
of
smokers
and
N members
• The polling (65.9% males and 3.3% females) showed
41.3% respondents consume 1-2 pack cigarette per
day with spending of IDR 450 – 600 thousands per
month.
• The proportion of non smoker who supported the
earmarking was hicher (83.4% ) compared to
smokers (75.9%).
• The proportion of smokers who know that ciagarette
is harmful reached 96.8% but the large majority of
them had difficulties in quit smoking.
9/23/17
7
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Merk Rokok
Sampoerna
Persentase (%)
189
45,5
Djarum
49
11,8
Gudang Garam
49
11,8
8
1,9
Dunhill
16
3,8
Lain-Lain
34
8,2
Marlboro
35
8,4
Surya
35
8,4
415
100
Bermacam-macam
Jumlah
9/23/17
Jumlah
8
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
9/23/17
9
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Earmarking Revenues for JKN
“special insurance for smokers” or Sintax for JKN”
The highest ecxise as percent of retail prices is charged by Egypt with
73.3% of cigarette price goes to tax, followed by Thailand (66.59%) and
the Philippine (63.55%).
Local Tax : 10% of excise revenue for local government in Indonesia
Philippine has implemented sin tax with 80% of incremental revenue goes
to the National Health Insurance Program (PhilHealth), MDGs, and Health
Awareness program. (paul, 2016)
Earmarking in England, California USA, Thailand, Australia, New
Zaeland, Egypt
9/23/17
10
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Raising Cigarette Prices and Excise to
Public Support
ance JKN
% Smoked
90
80
70
60
50
40
30
20
% 10
0
Raised Cigarette Prices
90.0
65.9
80.0
49.2
40.4
41.5
3.3
10.4
80.3
70.0
60.0
50.0
% 40.0
30.0
19.7
20.0
10.0
.0
Agreed
Disagree
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Proportion (%) of Respondent Who Aggreed and Disgreed on Raising Prices and Excise of
Cigarettes to Financing of the National Health Insurance, 2016
Smoking
Non smokers
Smokers
JKN membership
Non member
Member
Types of JKN Membership
PBI
Employed (PPU)
Self-employed (PBPU)
9/23/17
Disagreed (%)
16.5
24.0
Agreed (%)
83.5
76.0
p
20.7
18.9
79.3
81.1
0.989
18.3
17.9
20.5
81.7
82.1
79.5
0.797
0.793
0.005
12
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Aged
60 years
Education
< 6 years
6 -12 years
> 12 years
Reported monthly inome (IDR)
10 millions
9/23/17
Disagreed (%)
Agreed (%)
p
15.1
22.9
24.8
23.4
23.5
84.9
77.1
75.2
76.6
76.5
0.012
0.013
0.120
0.423
15.2
19.4
21.3
84.8
80.6
78.7
0.193
0.167
20.8
18.2
19.1
25.9
79.2
81.8
80.9
74.1
0.272
0.345
0.579
13
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
9/23/17
14
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Willingness to Reduce and Stop Smoking
Reduce smoking
%
50.0
45.0
40.0
35.0
30.0
25.0
20.0
15.0
10.0
5.0
.0
Stop Smoking
80.0
46.0
72.3
70.0
36.6
60.0
%
17.3
50.0
40.0
30.0
20.0
10.0
.0
14.5
13.3
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Conclusion
•
•
•
•
•
•
•
The prevalence of cigarette smoking is high because of prices of cigarette
is relatively cheap and it will affect health financing.
41.3% respondents consume 1-2 pack of cigarettes per day wasting up to
IDR 600 thousands per month per smokers.
Almost all smokers (96.8%) know that ciagarette is harmful for their
health.
More than 72.3% of smokers said that they would stop smoking if the
price of cigarette is above IDR 50,000 per pack.
This study found that large majority (80%) of non smokers and 76%
smokers supported increasing cigarette prices and excise to supplement
financing for the JKN.
Sintax Potential to increase additional revenue up to IDR 70 Trillion.
Increasing Cigarette Excise : WIN-WIN SOLUTION
9/23/17
16
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Recommendation
Further study to know how the legal and policy makers
support developing and implementing sin tax to finance JKN
Revising current Excise Law
excise revenues should also be earmarked
9/23/17
17
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Reference
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Help Tobacco Farmers and Tobacco industry workers to move to other crops and industry, Abou-Youssef,Hossam. 2002.The Egyptian Experience with Tobacco
Earmarking. World Health Organization, Tobacco Taxation and Innovative Health Care Financing. 2012. World Health Organization Regional Officer For Southeast Asia
CHEPS UI (Center for Health Economics and Policy Studies, Universitas Indonesia). Laporan Akhir
Kajian Model
Pengumpulan Iuran Program JKN Pada Kelompok Peserta Bukan Penerima Upah. Depok, 2016
DJSN (Dewan Jaminan Sosial Nasional). Peta Jalan Jaminan Kesehatan Nasional. DJSN, Jakarta 2012.
FAMoF (Fiscal Agency. Ministry of Finance. Indonesia); 2016. Presentation of the Minister of Finance of “Indonesian Excise Policy” on Workshop of Cigarette Excise:
Win-win Solution for Fiscal Space and Health. Jakarta, March 2016.
Hidayat, B and Thabrany H. Cigarette Smoking in Indonesia: Examination of a Myopic Model of Addictive Behaviour. Int. J. Environ. Res. Public Health 2010, 7, 24732485
Hidayat, Budi. Applied Econometrics to Estimate the Demand for Cigarette in Indonesia. Faculty of Public Health, Universitas Indonesia. Depok, 2011
Moeloek, N (Minster of Health). Introduction (Pengantar) to Dialog “Dialog Konstruktif Pemangku Kepentingan untuk Peningkatan JKN”. Jakarta, May 30, 2016.
MoF RI. Indonesia Tobacco Excise Policy. 2016. Presentation of the Minster of Finance Republic of Indonesia on the Workshop of Cigarette Excise: Win-win Solution
for Fiscal Space and Health. Jakarta, March 2016
MoF, Ministry of Finance (2015). http://www.anggaran.depkeu.go.id/dja/athumbs/apbn/ KESEHATAN1.pdf. accessed July 11. 2016
MoH.a, Pusdatin. Prilaku Merokok Masyarakat Indonesia, Bersasarakan Riskesdas 2007-2013. Jakarta, 2014
MoH.b. Global Youth Tobacco Survey. Indonesia Report, Jakarta, MoH, 2014
Paul, Jeremias. Securing the Wins of the Philippine Sin Tax Reform. Presentation on the Workshop of Cigarette Excise: Win-win Solution for Fiscal Space and Health.
Jakarta, March 2016
PMI, Philip Morris International. 2014 Annual Report: A Successful Investment Year. 2015
Sampoerna (PT Hanjaya Mandala Sampoerna Tbk). Laporan Tahunan 2014 (2014 Annual Report). 2015
Thabrany, H. Defisit JKN. Kompas Newspaper. Jakarta, 2016/03/02 or http://print.kompas.com/baca/2016/03/02/Defisit-JKN, accessed July 24, 2016
Thabrany, Hasbullah. Jaminan Kesehatan Nasional. 2nd Edition, 3rd Printing, Rajagraphindo, Jakarta 2016
USAID. Impact of Increasing Tobacco Tax on Government Revenue and Tobacco Consumption. SEADI Project, Jakarta 2013.
WHO. Earmarked of Tobacco Tax: Lessons Learnt from Nine Countries. WHO, Geneva, 2016.
WHO. Global Report on Trends in Prevalence of Tobacco Smoking. WHO, Geneva. 2015
WHO. WHO Technical Manual On TobaccoTax Administration. WHO, Geneva, 2011
World Bank team. Discussion on Workshop of Cigarette Excise: Win-win Solution for Fiscal Space and Health. Jakarta, March 2016
9/23/17
Hasbullah Thabrany
18
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Thank You
Public Support to Increase Cigarette
Price and Excise to Finance UHC
Hasbullah Thabrany dan Zahrina
Center for Health Economics and Policy Studies
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Background
Prevalence of Smoker
Cigarette Production
and Excise
Deficite of JKN
• 27% in 1995 to
36.5% in 2013
• 1.7% in 1995 to an
estimate of 6.7% in
2015 (Woman).
• from 7.1% in 1995 to
20.5% in 2013 (Young
Smoker).
• 67% Man are smoker
• 217.400 death per
Year
• 222.7 billion sticks in
2005 to 348 billion
sticks in 2015
• IDR 32.6 Trillion in
2005 to IDR 139.6
Trillion
• IDR 330 Trillions
spent for cigarette
• Health Expenditure
IDR 71.1 Trillions
(MoF, 2015)
• JKN covered 65% of
the population
• claim ratios of JKN of
111.5% in 2014 and
115.1% in 2015
• Mobilize Fund from
cigarette excise and
earmarking the
revenue
DO PEOPLE SUPPORT???
9/23/17
2
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Perbandingan Harga Rokok di Negara ASEAN
14
12
10
8
6
4
2
0
Indonesia
Philippines
Vietnam
Thailand
Harga $
9/23/17
Cambodia
Lao DR
Myanmar
Malaysia
Brunei
Timor Leste
Singapore
International dollars (at purchasing power parity)
3
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Objective
•
This study explored the possibility the people’s support in
increasing cigarette prices and exice to meet financial shortage
of the JKN.
• This polling conducted to explore cigarette consumption and
perception of price increase.
9/23/17
4
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Method
Dec
2015
Jan
2016
Phone Survey
Systematic Random Sampling
by the interval of 20.000 of mobile phones numbers.
POLLING
9/23/17
N=1000
5
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Result and Discussion
Respondent Characteristic
1.
2.
3.
4.
5.
Male (61,0%) Female (39,0%)
Average age (32,9) in range 14-78 years old
Education majority graduated high school (50,7%)
Income of Respondent 1 million – 3 million (38,8%)
Occupation distribution; private sector (26,2%), non formal sector (20,9%),
Others (18,6%)
6. 56,5% are JKN Participant
7. 41,5% are smoker
8. Penerima Bantuan Iuran (PBI) (13,2%), PBPU (66,9%), Private
Sector&Governmental Employee (19,9%)
9. Participant who use JKN (2,7%)
10.Came from 34 province
9/23/17
6
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Characteristics
of
smokers
and
N members
• The polling (65.9% males and 3.3% females) showed
41.3% respondents consume 1-2 pack cigarette per
day with spending of IDR 450 – 600 thousands per
month.
• The proportion of non smoker who supported the
earmarking was hicher (83.4% ) compared to
smokers (75.9%).
• The proportion of smokers who know that ciagarette
is harmful reached 96.8% but the large majority of
them had difficulties in quit smoking.
9/23/17
7
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Merk Rokok
Sampoerna
Persentase (%)
189
45,5
Djarum
49
11,8
Gudang Garam
49
11,8
8
1,9
Dunhill
16
3,8
Lain-Lain
34
8,2
Marlboro
35
8,4
Surya
35
8,4
415
100
Bermacam-macam
Jumlah
9/23/17
Jumlah
8
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
9/23/17
9
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Earmarking Revenues for JKN
“special insurance for smokers” or Sintax for JKN”
The highest ecxise as percent of retail prices is charged by Egypt with
73.3% of cigarette price goes to tax, followed by Thailand (66.59%) and
the Philippine (63.55%).
Local Tax : 10% of excise revenue for local government in Indonesia
Philippine has implemented sin tax with 80% of incremental revenue goes
to the National Health Insurance Program (PhilHealth), MDGs, and Health
Awareness program. (paul, 2016)
Earmarking in England, California USA, Thailand, Australia, New
Zaeland, Egypt
9/23/17
10
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Raising Cigarette Prices and Excise to
Public Support
ance JKN
% Smoked
90
80
70
60
50
40
30
20
% 10
0
Raised Cigarette Prices
90.0
65.9
80.0
49.2
40.4
41.5
3.3
10.4
80.3
70.0
60.0
50.0
% 40.0
30.0
19.7
20.0
10.0
.0
Agreed
Disagree
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Proportion (%) of Respondent Who Aggreed and Disgreed on Raising Prices and Excise of
Cigarettes to Financing of the National Health Insurance, 2016
Smoking
Non smokers
Smokers
JKN membership
Non member
Member
Types of JKN Membership
PBI
Employed (PPU)
Self-employed (PBPU)
9/23/17
Disagreed (%)
16.5
24.0
Agreed (%)
83.5
76.0
p
20.7
18.9
79.3
81.1
0.989
18.3
17.9
20.5
81.7
82.1
79.5
0.797
0.793
0.005
12
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Aged
60 years
Education
< 6 years
6 -12 years
> 12 years
Reported monthly inome (IDR)
10 millions
9/23/17
Disagreed (%)
Agreed (%)
p
15.1
22.9
24.8
23.4
23.5
84.9
77.1
75.2
76.6
76.5
0.012
0.013
0.120
0.423
15.2
19.4
21.3
84.8
80.6
78.7
0.193
0.167
20.8
18.2
19.1
25.9
79.2
81.8
80.9
74.1
0.272
0.345
0.579
13
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
9/23/17
14
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Willingness to Reduce and Stop Smoking
Reduce smoking
%
50.0
45.0
40.0
35.0
30.0
25.0
20.0
15.0
10.0
5.0
.0
Stop Smoking
80.0
46.0
72.3
70.0
36.6
60.0
%
17.3
50.0
40.0
30.0
20.0
10.0
.0
14.5
13.3
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Conclusion
•
•
•
•
•
•
•
The prevalence of cigarette smoking is high because of prices of cigarette
is relatively cheap and it will affect health financing.
41.3% respondents consume 1-2 pack of cigarettes per day wasting up to
IDR 600 thousands per month per smokers.
Almost all smokers (96.8%) know that ciagarette is harmful for their
health.
More than 72.3% of smokers said that they would stop smoking if the
price of cigarette is above IDR 50,000 per pack.
This study found that large majority (80%) of non smokers and 76%
smokers supported increasing cigarette prices and excise to supplement
financing for the JKN.
Sintax Potential to increase additional revenue up to IDR 70 Trillion.
Increasing Cigarette Excise : WIN-WIN SOLUTION
9/23/17
16
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Recommendation
Further study to know how the legal and policy makers
support developing and implementing sin tax to finance JKN
Revising current Excise Law
excise revenues should also be earmarked
9/23/17
17
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Reference
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Help Tobacco Farmers and Tobacco industry workers to move to other crops and industry, Abou-Youssef,Hossam. 2002.The Egyptian Experience with Tobacco
Earmarking. World Health Organization, Tobacco Taxation and Innovative Health Care Financing. 2012. World Health Organization Regional Officer For Southeast Asia
CHEPS UI (Center for Health Economics and Policy Studies, Universitas Indonesia). Laporan Akhir
Kajian Model
Pengumpulan Iuran Program JKN Pada Kelompok Peserta Bukan Penerima Upah. Depok, 2016
DJSN (Dewan Jaminan Sosial Nasional). Peta Jalan Jaminan Kesehatan Nasional. DJSN, Jakarta 2012.
FAMoF (Fiscal Agency. Ministry of Finance. Indonesia); 2016. Presentation of the Minister of Finance of “Indonesian Excise Policy” on Workshop of Cigarette Excise:
Win-win Solution for Fiscal Space and Health. Jakarta, March 2016.
Hidayat, B and Thabrany H. Cigarette Smoking in Indonesia: Examination of a Myopic Model of Addictive Behaviour. Int. J. Environ. Res. Public Health 2010, 7, 24732485
Hidayat, Budi. Applied Econometrics to Estimate the Demand for Cigarette in Indonesia. Faculty of Public Health, Universitas Indonesia. Depok, 2011
Moeloek, N (Minster of Health). Introduction (Pengantar) to Dialog “Dialog Konstruktif Pemangku Kepentingan untuk Peningkatan JKN”. Jakarta, May 30, 2016.
MoF RI. Indonesia Tobacco Excise Policy. 2016. Presentation of the Minster of Finance Republic of Indonesia on the Workshop of Cigarette Excise: Win-win Solution
for Fiscal Space and Health. Jakarta, March 2016
MoF, Ministry of Finance (2015). http://www.anggaran.depkeu.go.id/dja/athumbs/apbn/ KESEHATAN1.pdf. accessed July 11. 2016
MoH.a, Pusdatin. Prilaku Merokok Masyarakat Indonesia, Bersasarakan Riskesdas 2007-2013. Jakarta, 2014
MoH.b. Global Youth Tobacco Survey. Indonesia Report, Jakarta, MoH, 2014
Paul, Jeremias. Securing the Wins of the Philippine Sin Tax Reform. Presentation on the Workshop of Cigarette Excise: Win-win Solution for Fiscal Space and Health.
Jakarta, March 2016
PMI, Philip Morris International. 2014 Annual Report: A Successful Investment Year. 2015
Sampoerna (PT Hanjaya Mandala Sampoerna Tbk). Laporan Tahunan 2014 (2014 Annual Report). 2015
Thabrany, H. Defisit JKN. Kompas Newspaper. Jakarta, 2016/03/02 or http://print.kompas.com/baca/2016/03/02/Defisit-JKN, accessed July 24, 2016
Thabrany, Hasbullah. Jaminan Kesehatan Nasional. 2nd Edition, 3rd Printing, Rajagraphindo, Jakarta 2016
USAID. Impact of Increasing Tobacco Tax on Government Revenue and Tobacco Consumption. SEADI Project, Jakarta 2013.
WHO. Earmarked of Tobacco Tax: Lessons Learnt from Nine Countries. WHO, Geneva, 2016.
WHO. Global Report on Trends in Prevalence of Tobacco Smoking. WHO, Geneva. 2015
WHO. WHO Technical Manual On TobaccoTax Administration. WHO, Geneva, 2011
World Bank team. Discussion on Workshop of Cigarette Excise: Win-win Solution for Fiscal Space and Health. Jakarta, March 2016
9/23/17
Hasbullah Thabrany
18
Universitas Indonesia, Pusat Kajian Ekonomi & KebijakanKesehatan
Thank You