- In an attempt to stimulate the development of the automotive sector during the ongoing Corona Virus Disease 2019 (COVID-19) pandemic, the Minister of Industry, Agus Gumiwang Kartasasmita, has proposed the introduction of a 0% tax for purchases of new cars, as well as a reduction in the current vehicle tax to Indonesia’s Minister of Finance, Sri Mulyani. Mr. Gumiwang has stated that the introduction of tax incentives would increase the public’s purchasing power and, as a result, boost flagging sales of automotive products.
- In response to these suggestions, Mrs. Mulyani has stated that the Ministry of Finance was currently assessing the proposed automotive taxation incentives in relation to both current conditions and public demand.
- The Association of Indonesian Automotive Industries (Gabungan Industri Kendaraan Bermotor Indonesia – “Gaikindo”) has expressed its broad support for Mr. Gumiwang’s proposals, as the organization believes that an increase in automotive sales will ultimately lead to the reopening of automotive and component factories. In addition, Gaikindo has also expressed its hope that various other taxes and administrative fees would also be reduced, which would likely lead to a reduction in the prices of new vehicles, including value-added tax, luxury-goods sales tax, title-transfer fees and vehicle tax. (ANT)
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