Tax Incentives to Stimulate Domestic Consumption

Fitri Novia Heriani, Robert Sidauruk

The Government is currently preparing several measures to maintain stability in the national economy. Such measures will include a new scheme for tax incentives and further policies to minimize exposure to the current bout of inflation .

During a press conference at the Indonesia Investment Coordinating Board’s office in Jakarta on Monday, Minister of Finance Chatib Basri informed that the tax incentives will be given to certain business sectors in order to reduce the high level of retrenchments in those business sectors.

During his talk, Chatib Basri contended that the level of retrenchments in certain industry sectors to impacts on national economic growth to a certain extent.

Besides reducing retrenchments, the tax incentives will also be used as a tool to achieve the targeted national economic growth of 6.4 to 6.9 percent.

The Minister believes that the new tax incentive scheme will stimulate an increase in consumption and bring positive stimulus to industry.

“If we can maintain the high demand from consumers to purchase goods and services, industry will be vibrant and businesses will be able to employ new workers,” says Chatib Basri.

Domestic consumption has become the pulse of Indonesia’s national stabilization as it contributes up to 55 percent of Indonesia’s economic growth.

“The Government will still focus on boosting national economic growth by focusing on the ‘keep buying strategy’,” explained Chatib.

In regard to the high inflation rate, Chatib ensured that the Government will have this undercontrol by October.

Meanwhile, throughout this August the Government will not issue market-surprising policies, for example an increase in fuel prices or similar policies.

Going forward, in September the Government will commence analyzing imported goods in order to maintain market stability.

“Inflation will under control by October and this will assist the public’s purchasing power,” says Chatib.

(hot/kc)

Fitri Novia Heriani, Robert Sidauruk

The Government is currently preparing several measures to maintain stability in the national economy. Such measures will include a new scheme for tax incentives and further policies to minimize exposure to the current bout of inflation .

During a press conference at the Indonesia Investment Coordinating Board’s office in Jakarta on Monday, Minister of Finance Chatib Basri informed that the tax incentives will be given to certain business sectors in order to reduce the high level of retrenchments in those business sectors.

During his talk, Chatib Basri contended that the level of retrenchments in certain industry sectors to impacts on national economic growth to a certain extent.

Besides reducing retrenchments, the tax incentives will also be used as a tool to achieve the targeted national economic growth of 6.4 to 6.9 percent.

The Minister believes that the new tax incentive scheme will stimulate an increase in consumption and bring positive stimulus to industry.

“If we can maintain the high demand from consumers to purchase goods and services, industry will be vibrant and businesses will be able to employ new workers,” says Chatib Basri.

Domestic consumption has become the pulse of Indonesia’s national stabilization as it contributes up to 55 percent of Indonesia’s economic growth.

“The Government will still focus on boosting national economic growth by focusing on the ‘keep buying strategy’,” explained Chatib.

In regard to the high inflation rate, Chatib ensured that the Government will have this undercontrol by October.

Meanwhile, throughout this August the Government will not issue market-surprising policies, for example an increase in fuel prices or similar policies.

Going forward, in September the Government will commence analyzing imported goods in order to maintain market stability.

“Inflation will under control by October and this will assist the public’s purchasing power,” says Chatib.

(hot/kc)

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