Deputy Speaker Of House Sufmi Dasco: President Agreed To Multi-rate VAT

Deputy Speaker Of House Sufmi Dasco: President Agreed To Multi-rate VAT

Saturday, 07 Dec 2024

Deputy Chairman of the Indonesian House of Representatives, Sufmi Dasco Ahmad, announced that President Prabowo Subianto has agreed to implement a multi-rate system for the Value Added Tax (VAT). Under this new system, VAT will feature three different rates. Luxury goods will be taxed at 12 percent, certain items will incur an 11 percent rate, while some components will be entirely exempt from VAT. This information was shared following a leadership meeting of the House with three Deputy Ministers of Finance at the House of Representatives building in Senayan, Jakarta, on Friday, December 6, 2024. "The results of our discussions, including the multi-rate system, were released to the media after our talks with Mr. Prabowo," Dasco stated to reporters.

He noted that the proposal for a multi-rate VAT system was jointly suggested by both the House and President Prabowo himself.

"There is indeed a shared understanding; when we proposed it, the President had a similar perspective, allowing us to coordinate effectively," he explained. Dasco revealed that the visit of the three Deputy Ministers of Finance to the House was a follow-up to the meeting between the House and Prabowo. He expressed confidence that the government and the House are moving closer to finalizing the multi-rate VAT policy. However, the final decision will be announced directly by the government, as the regulations regarding the VAT increase must take effect on January 1, 2025.

"Previously, we had already proposed this to the President, and they came to follow up and coordinate on how to implement it effectively, ensuring it benefits the public while also addressing the shortfall in revenue targets that would arise if everything were taxed at 12 percent," he elaborated. "Fortunately, we have reached a consensus today, and we aim to do more for the people in terms of revenue," Dasco added. (reza@insightinnews.com)

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