Land value capture works based on a good value cycle that will gain traction among private sectors in infrastructure development.
Jakarta (ANTARA) - Coordinator Economic Affairs Minister Airlangga Hartarto highlighted that land value capture can bolster participation of the private sector in infrastructure development.

“Land value capture works based on a good value cycle that will gain traction among private sectors in infrastructure development,” Hartarto noted during the launch and discussion on land value capture held online here on Tuesday.

Implementation of the land value capture scheme in Indonesia is projected to offer a host of economic benefits, including boosting locally-generated revenue (PAD) through local taxes and retributions; building more organized urban areas; facilitating growth of the regional economy; and ensuring economic equality across areas, he expounded.

Hartarto stressed that implementation of land value capture in Indonesia has to be supported by regulations on taxation, spatial plan, and land utilization.

Moreover, the synchronized regulation necessitates governmental support, at the national or regional level, and it becomes a stepping stone to ensure effective implementation of land value capture in Indonesia, Hartarto stated.

“I expect that through this event, we can generate outstanding ideas and strategies on how to accelerate our economy through infrastructure development,” he remarked.

The government is collaborating with investors and banks to fulfill the requirements of infrastructure spending that significantly rose during the 2020-2024 period. The Coordinating Ministry for Economic Affairs has also worked with the Asian Development Bank to draft a study titled “Innovative Infrastructure Financing through Value Capture in Indonesia” in a bid to facilitate innovation in the financing scheme for infrastructure development in Indonesia.

Land value capture refers to a policy on the use of increasing land value generated by investment, activities, and the government’s policy in the area through the application of tax-based land value capture and development-based land value capture. Related news: President Jokowi issues directives on land and building acquisition tax facility
Related news: Jokowi signs new regulation on land acquisition for strategic projects

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Translator: Juwita Trisna Rahayu, Kuntum
Editor: Suharto
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