Formulating an Excise Duty on Plastic: A Strategy to Manage Marine Plastic Waste in Indonesia

Abstract

Plastic excise duty is one of the programs prescribed to combat the marine waste problem in Indonesia. This article presents an insight into the formulation of the government regulations needed to implement plastic excise duty. Initially planned to be implemented by 2018, the program is still in the process almost five years later. This article aims to identify the core issues discussed in the process, the stakeholders playing the central role, and their perspectives by interviewing key informants involved in the inter-ministerial committee. This research identified four ministries as definitive stakeholders as representatives of fiscal, industrial, and environmental groups. These groups have distinct interests in five core issues discussed during the negotiation process: the urgency of implementing an excise duty, its goals, scope of implementation, rate of tariff, and the settings for earmarking. This research found that environmental consideration was the central premise during the interministerial negotiation. However, the government’s hesitation to immediately implement an excise on plastic bags shows that currently, the government tends to prioritize economic considerations.