Amendment of luxury tax will be realize
— yulyanto • September 17th, 2008
The government of Indonesia which representative by House’s Commission IX on Finance, national development planning, banking and non-bank financial institutions ,will propose some amendment to raise the luxury tax by between 10 and 200%, from its current standing of 75% of a luxury item’s worth (www.thejakartapost.com).
Vice chairman of tax, public policy, monetary, excise and customs affairs at the Indonesian Chamber of Commerce and Industry, Hariyanto Sukamdani said that this amendment should be a starting point for lowering the business sector’s costs.
Hopely, additional goods and services should be exempted in the upcoming amendment to the luxury and value-added tax (VAT) law. Among the services proposed by the group are food catering, money transfers via the post office, parking fees and public phones, while goods included agricultural and foresty-based products, as well as fishery, livestock and plantation commodities.
According to Chairman of the Indonesian Association of Food and Beverage Manufacturers (GAPMMI), currently catering business have been burdened with paying several types of regional taxes similar to the VAT. The catering companies should be free from VAT as they regularly pay restaurant taxes slapped on by local administrations, and it will help them to expand their business.
Now, government has raised next year’s VAT target become to Rp. 245.4 trillion from Rp. 195.5 trillion, expecting to collect Rp. 726.3 trillion in total tax revenue next year, up 19.2% from the Rp. 641 trillion expecting this year.
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