"In the area of taxation, the government continues taxation reforms through improving administration and tax compliance and strengthening taxation database as well as information systems," President Widodo noted in his speech for the 2020 State Budget Draft at the House of Representatives’ plenary meeting at the legislative complex in Jakarta, Friday.
In order to boost competitiveness and investment, the government provides tax incentives through several instruments, specifically the expansion of tax holidays, changes in tax allowance, investment allowance, incentives for the development of vocational activities, research, and labor-intensive industries.
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The president remarked that the labor-intensive industry will also receive exemption from import tax and tax subsidies.
"The government will also conduct a policy on level equalization for conventional and e-commerce businesses to optimize tax revenue in the digital age," the president stated.
In the meantime, the PNBP system will be reformed through boosting regulations and enhancing governance while maintaining the quality of public services.
State revenues and grants had amounted to Rp2,221.5 trillion in 2020, while state expenditure reached Rp2,528.8 trillion.
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