P H
Jun 15, 2016 10:02:07
Tax increase on tobacco import

Government is looking into plan to impose higher import tax for imported tobacco. This is likely to lead to higher COGS for major tobacco companies in Indonesia. We estimate 20-50% of tobacco raw materials are imported. $HMSP has higher proportion than $GGRM for imported tobacco leaves. On the other hand, clove price remain relatively mild and the tax risk is relatively limited given that 90% of global supply are from Indonesia.

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