Jumat, Juni 11, 2021

Government Plan to Impose PPN on Sembako Goods Comes under Fire

Through the draft amendment to Law No. 6 of 1983 on General Provisions and Procedures on Taxation (“Draft Amendment”), the government is planning to impose Value-Added Tax (Pajak Pertambahan Nilai – “PPN”) upon basic necessities (“sembako”), including rice, corn, eggs, dairy products, vegetables, fruit and spices.
In response to this development, the Head of the Center for Indonesian Policy Studies, Felippa Ann Amanta, has raised concerns that the imposition of PPN upon sembako will threaten Indonesia’s overall food security and economic climate as sembako prices will undoubtedly increase, making it difficult for households, especially lower-income ones, to secure basic necessities. This is likely to prove particularly true during the ongoing coronavirus pandemic, which has seen the general public’s income undergo a significant fall.
On a similar note, Mufti Anam, a member of Indonesia’s House of Representatives, has also voiced criticism of the plan to impose PPN upon sembako, as he claims that the new tax will prove counterproductive in terms of the momentum of economic recovery in the wake of the recent recession. Mufti went on to assert that two negative impacts will likely result if the Draft Amendment is implemented, specifically: 1) Risk of inflation, which will further reduce the public’s purchasing power and ultimately lead to economic stagnation; and 2) Complicate efforts aimed at alleviating poverty, since the overall poverty rate is likely to increase in line with the increase in sembako prices.
For more information on this story, see Hukumonline: “Beragam Risiko Negatif dari Pajak Sembako”.

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Through the draft amendment to Law No. 6 of 1983 on General Provisions and Procedures on Taxation (“Draft Amendment”), the government is planning to impose Value-Added Tax (Pajak Pertambahan Nilai – “PPN”) upon basic necessities (“sembako”), including rice, corn, eggs, dairy products, vegetables, fruit and spices.
In response to this development, the Head of the Center for Indonesian Policy Studies, Felippa Ann Amanta, has raised concerns that the imposition of PPN upon sembako will threaten Indonesia’s overall food security and economic climate as sembako prices will undoubtedly increase, making it difficult for households, especially lower-income ones, to secure basic necessities. This is likely to prove particularly true during the ongoing coronavirus pandemic, which has seen the general public’s income undergo a significant fall.
On a similar note, Mufti Anam, a member of Indonesia’s House of Representatives, has also voiced criticism of the plan to impose PPN upon sembako, as he claims that the new tax will prove counterproductive in terms of the momentum of economic recovery in the wake of the recent recession. Mufti went on to assert that two negative impacts will likely result if the Draft Amendment is implemented, specifically: 1) Risk of inflation, which will further reduce the public’s purchasing power and ultimately lead to economic stagnation; and 2) Complicate efforts aimed at alleviating poverty, since the overall poverty rate is likely to increase in line with the increase in sembako prices.
For more information on this story, see Hukumonline: “Beragam Risiko Negatif dari Pajak Sembako”.

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