Poor Indonesians use 70 percent of income on cigarettes - Report

[News_Editor]

Poor Indonesians use 70 percent of income on cigarettes - Report

2011-07-28 11:19:30 GMT+7 (ICT)

JAKARTA, INDONESIA (BNO NEWS) -- Seventy percent of poor Indonesian's income is spent on cigarettes, according to an investigation released on Wednesday.

The academic research was conducted by Abdillah Ahsan, a researcher from state University of Indonesia's Economics Faculty's Demographic Institute, in which it was concluded that around 70 percent of the poorest households' spending was on cigarettes - the second biggest expense after food - Antara news agency reported.

Abdillah expressed that these numbers were very concerning, as burdens of the lower economic sectors of the country are greatly multiplied by addiction to tobacco.

According to Indonesian law, two percent of the state income is distributed to tobacco producing provinces, which in 2010 reached around Rp 1.1 trillion ($128.7 million).

"The funds will be used to improve the quality of raw materials, develop industry, developing social environment and popularization of excise and illegal excise eradication," said Abdillah.

However, only a small percentage of these funds are used for social and environment development, which includes employment creation and health awareness, such as the affects of tobacco.

-- © BNO News All rights reserved 2011-07-28

[Chris Lawrence]

Unbelievable

[nottocus]

maybe they should try giving up.

[otherstuff1957]

70% is the second biggest expense?  So what percentage of their income do they spend on the first biggest expense?  75%?  Either there is some bad translation going on here or else these guys need to brush up on their Math skills!

Edited July 28, 2011 by otherstuff1957

[DP25]

So Indonesians are already paying at least 140% of their income on cigarettes and food, and they haven't even payed for housing or transportation yet?

[mpoppel]

So Indonesians are already paying at least 140% of their income on cigarettes and food, and they haven't even payed for housing or transportation yet?

They mean that overall for all people in Indonesia, cigarettes is the 2nd biggest expensive after food and some of the poor people spend 70 percent of their income on cigarettes.

[maidu]

are some of them the same folks who would stick a rhino horn handled dagger in to your gut if you offended their deity? Strange species we are.

[afarang]

are some of them the same folks who would stick a rhino horn handled dagger in to your gut if you offended their deity? Strange species we are.

No mate ,You are the strange species. Not them.

[junkofdavid2]

And yet they tend to hate/blame the "elite" Indonesian Chinese.

Why does that sound familiar?

(Good thing they don't have farang husbands, they'd hate/blame the Indonesian Chinese even more! LOL )

[exbelg]

guess it is time to raise by 90% the local daily wage, same as in hum....

[DanR]

Perhaps it should have been 70% of discretionary spending. Or perhaps it's 27% of all spending. Or 7% of money won gambling on fights between beetles. Or, more likely, it's yet another utterly vacuous, worthless, pointless bit of crap.

How much is it to get sent this stuff by SMS? However much it is, it's got to be a bargain.

[Anyse]

Here in the US, many years ago, they had a report on the news Magazine "60 Minutes" about this same issue. They investigated the tobacco industry's need to fill in for lost customers in the US as many were quitting or just not taking up the habit. So, the next horizon was the Far East and Southeast Asia! They were practically giving away cigarettes at the beginning! They showed many of the poor who were getting hooked on cigarettes and how disproportionate the costs became over time as the final payback was successful: poor people spending much of their income on the product, tobacco in the form of cigarettes! I am not at all surprised by this research or its findings: the tobacco industry has known this for years! So, whose fault is it? The poor who smoke or the industry. Knowing that tobacco is a drug as well as how addictive it is (it is actually harder to get off of nicotine that it is to get off of heroin!), knowing that the PR of the tobacco industry was looking for a market to fill in and to even raise their profits and knowing that the tobacco industry has been "improving" their product so that cigarettes can deliver greater and greater amounts of nicotine with each cigarette, I would blame the industry as well as the government. The industry for obvious reasons and the government, as they knew that they would profit in taxes and that cigarettes also cause cancer, raising the costs for health care for smokers in the last years of their lives with cancer and pulmonary treatments.

I do not know what they have done on the African continent; however, maybe this will be their NEXT target.

[Atmos]

how about: 11 percent on tobacco?

I would suggest the following article contains more accurate figures - dated the day before OP, and note quotes from the same Abdillah Hasan from the Demography Institution of University of Indonesia as OP

Eleven percent on tobacco; maybe mis-heard as eleventy!

Poor families spend more on cigarettes

Irawaty Wardany, The Jakarta Post, Jakarta | Wed, 07/27/2011 6:28 PM

Despite their financial hardships, many poor families in Indonesia prioritize spending on cigarettes rather than on other needs. Six out of 10 poor households report spending on cigarettes.

According to the 2009 National Socio-Economic survey, poor households spent 19 percent of their income on staple foods and 11 percent on tobacco, 2 percent for education and 3 percent on health care.

Ekowati Rahajeng, the Health Ministry director of non-communicable diseases, said the spending habits could be related to the economic conditions that made poor people resort to smoking cigarettes without realizing that spending in cigarettes would only pull them deeper into poverty.

Abdillah Hasan from the Demography Institution of University of Indonesia calculated the potential loss of consuming cigarettes.

"Let's say they consume a pack of cigarettes a day that cost them Rp 10,000 [uS$1.18]. In a month, they will spend Rp 300,000 and Rp 3.65 million in a year," Abdillah said.

He went on, saying that in 10 years they could save Rp 36.5 million, which could be spent on a down payment for a house or pay an admission fee to a university for their children.

Therefore, the institution urged the government to issue cigarette control regulations through, among other methods, increasing the cigarette tax, a total ban on cigarette advertisement, health warnings through pictures printed on the cigarette packs and imposing smoke-free areas.

Edited July 31, 2011 by Atmos

[Orac]

Another was of looking at this is that the excise on tabacco products is too high...

excise taxes on cigarettes account for nearly 10 percent of state revenue

http://www.reuters.com/article/2010/10/13/indonesia-economy-tax-idUSJKB00403420101013

[timberboy]

They dont hav alcohol to abuse in their culture, so cig's are all they got.

Too bad that their govt is more interested in collecting excise taxes ,instead of making a concerted effort to help the population resist using tobacco. But i guess that can be said in most places in the world.

[who]

.

The academic research was conducted by Abdillah Ahsan, a researcher from state University of Indonesia's Economics Faculty's Demographic Institute, in which it was concluded that around 70 percent of the poorest households' spending was on cigarettes - the second biggest expense after food.

---- If 70% on cigarettes was the 2nd biggest, the 1st biggest must have been 71% or more ----