- In line with the stated target of increasing the utilization of new renewable energy (energi baru terbarukan – “EBT”) up to a level of 23% by 2025, Rofik Hananto, a member of Commission VII at the House of Representatives, is hoping that the introduction of electric vehicles will be immediately rolled out across the country, starting with government vehicles. Mr. Hananto believes that Indonesia possesses sufficient water, air, sun, marine, geothermal and biomass resources in order to support the required demand for electricity and has stated that the government must, therefore, create a massive, structured program aimed at strengthening the EBT sector in order to achieve the EBT utilization target set out above.
- The need for such a program is also being echoed by the Minister of Industry, Agus Gumiwang, who stated recently that the government was aiming to achieve a domestic component level (TKDN) of 100% in relation to Indonesian automotive products. However, achieving this level will require the instigation of a detailed research-and-development program which addresses domestic component levels (TKDN) and EBT incentives. Hopefully, such a program will result in the improvement of both human resources and technologies within Indonesia’s automotive industry.
- In line with the above outlined plans, the government has already issued Regulation of the Government No. 45 of 2019 on the Amendment to Regulation of the Government No. 94 of 2010 on Calculations of Taxable Income and Payments of Income Tax for the Current Year, which specifically addresses various super tax deductions which can be extended in relation to research, innovation and vocational initiatives. Through this regulation, the government is hoping to empower businesses by allowing them to enjoy tax incentives which amount to gross income deductions of 200% - 300%. (ANT)
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