"The government is pushing for a front loading of several fiscal policies. We know that in the first quarter of last year, it was at minus 0.7 percent, and of course, in the first quarter of 2022, we are optimistic of it growing positively," the minister noted at the National Seminar on Regional Economic Acceleration to Stimulate National Recovery in Jakarta, Tuesday.
Hartarto remarked that Indonesia's economy in the first quarter of 2021 had recorded a contraction of 0.74 percent due to the COVID-19 pandemic that was still quite massive, so the government expects positive growth during the first quarter of 2022.
Some of the continuing fiscal incentives encompass government-borne value-added tax for the housing sector that will be offered for nine months at 50 percent for landed houses or flats, with a maximum selling price of Rp5 billion.
He emphasized that the change from a building permit to a building approval must be completed by all local governments in order to encourage the effectiveness of this fiscal incentive.
"The Central Board of Real Estate Indonesia (DPP REI) assesses the potential for incentives that can be absorbed at Rp3.26 trillion," he noted.
The other comprises the expansion of the program of Cash Assistance for Street Vendors, Stalls and Fishermen (BT-PKLWN), with the amount of benefits provided to each at Rp600 thousand to a total of 2.76 million people, including one million street vendors or shop owners and 1.76 million fishermen.
The locations of these beneficiaries are for the 212 districts and cities that are included in the 2022 poverty alleviation target.
The other is the government-borne luxury goods sales tax (PPnBM DTP) for motorized vehicles.
Based on the Decree of Minister of Finance Number 120/PMK.010/2021, the vehicles that receive the PPnBM incentive are passenger motor vehicles, with an engine capacity of up to 1,500 cc (100 percent); 4×2 passenger motor vehicles, with an engine capacity of >1,500 cc to 2,500 cc (50 percent); and 4×4 passenger motor vehicles, with an engine capacity of >1,500 cc to 2,500 cc (25 percent).
The government had earlier decided to extend tax incentives for COVID-19 pandemic-impacted taxpayers until the end of the first semester of 2022.
"The tax incentives are expected to support certain sectors that need them, so that they will be able to expedite the national economic recovery," Director of Counseling, Services and Public Relations of the Taxation Directorate General at the Finance Ministry Neilmaldrin Noor noted in a written statement released on Thursday.
The decision is stipulated in the Finance Minister's Regulation No. 3/PMK.03/2022 concerning Tax Incentives for COVID-19-Affected Taxpayers.
The extended tax incentives include income tax article 22-free facility for the import of goods by 72 types of business undertakings (KLU), reduced installments in income tax article 25 for 156 types of business undertakings and government-borne final income tax on construction services for taxpayers receiving an accelerated irrigation water improvement program (P3-TIGAI).
Under the Finance Minister's Regulation, taxpayers that have applied for income tax article 22-free facility and/or filed a notification on the use of income tax article 25 incentives based on the Finance Minister's Regulation No. 9/PMK.03/2021 must file other application or notification based on the new regulation in order to benefit from the income tax article 22-free facility.
In addition, the government offers an opportunity to job providers, taxpayers or tax withholders that have filed and will file a realization report for the January-December 2021 period to revise the report until March 31, 2022, at the latest.
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Translator: Astrid F, Azis Kurmala
Editor: Sri Haryati
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