Jakarta (ANTARA) - The government has budgeted Rp3.7 trillion (around US$239 million) for fiscal incentives in the housing sector in 2023 and 2024 to support the purchase of commercial houses and houses for low-income and impoverished people.

“The policy is aimed at stimulating the housing sector to give it a significant multiplier effect as well as a good impact on the growth of the Indonesian economy in 2023 and 2024,” chairperson of the Fiscal Policy Agency of the Ministry of Finance, Febrio Kacaribu, informed in Jakarta on Friday.

One of the incentives is outlined in the Regulation of the Minister of Finance Number 120 of 2023 on the Value Added Tax of Landed Houses and Flats Covered by the Government (PPN DTP) for Fiscal Year 2023.

For houses with a price of up to Rp5 billion (around US$323,000), the PPN DTP given is calculated based on a maximum purchase price of Rp2 billion.

Home purchases completed between November 2023 and June 2024 will receive a 100 percent PPN DTP (a full VAT exemption), while the incentive for the July–December 2024 period will be 50 percent.

The other incentive is administrative fee assistance (BBA) for low-income individuals seeking affordable housing.

The incentive will be in effect for 14 months (November 2023–December 2024), with the assistance of Rp4 million (around US$258) per house.

In November–December 2023, the incentive will be provided for 62,000 units, and in 2024, it will be allocated for 220,000 units.

BBA is regulated in the Regulation of the Minister of Public Works and Public Housing Number 11 of 2023 on administrative fee assistance in financing home ownership for low-income societies.

Meanwhile, incentive for impoverished societies will be provided through Integrated Simple House (RST) assistance worth Rp20 million (around US$1,291) per individual.

The incentive will be available from November to December 2023. The issuance of the assistance is being coordinated by the Ministry of Social Affairs.

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Translator: Imamatul, Luthfia, Azis Kurmala
Editor: Anton Santoso
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