JAKARTA – The government through the Directorate General (Ditjen) of Taxes of the Ministry of Finance (Kemenkeu) ensures that the policy of adjusting the Value Added Tax (VAT) rate to 12% next year will continue to provide direct benefits to the community.
Director of Counseling, Services, and Public Relations of the Directorate General of Taxes, Ministry of Finance, Dwi Astuti, revealed that various social programs and subsidies will continue to run to support community welfare.
“Benefits that continue to be received by the community include Direct Cash Assistance (BLT), Family Hope Program (PKH), Food Card, Smart Indonesia Program (PIP), Smart Indonesia Card (KIP) for College, electricity subsidies, 3 kg LPG subsidies, fuel subsidies, and fertilizer subsidies,” explained Dwi.
Dwi added that the government is also preparing economic stimulus to reduce the impact of the increase in VAT rates.
“This stimulus will ease the burden on the community while maintaining the momentum of economic growth which until the end of 2024 will remain at an average of 5 percent,” he added.
Coordinating Minister for Economic Affairs, Airlangga Hartarto, explained that the government has designed various policies to maintain people’s purchasing power amidst the adjustment of VAT rates.
One concrete step is to provide food assistance in the form of 10 kg of rice per month for January-February 2025 to 16 million Food Assistance Recipients (PBP).
In addition, the government provides incentives in the form of Government Borne Value Added Tax (PPN DTP) of 1 percent for products such as wheat flour, industrial sugar, and subsidized oil (Minyakita). Other stimuli include easy access to Job Loss Insurance (JKP) for workers who are laid off and an extension of the validity period of the final Income Tax (PPh) by 0.5 percent for business actors.
“This policy not only provides protection to the community but also maintains household consumption which contributes more than 50 percent to the Indonesian economy. Its growth remains strong, expected to reach above 5 percent,” said Airlangga.
Furthermore, the government has also announced a policy of electricity tariff discounts of up to 50 percent which will take effect from January 1, 2025 as well as VAT incentives for the property sector.
This government policy has received a positive response from various parties. Padjadjaran University public policy expert, Yogi Suprayogi, assessed that the economic stimulus measures rolled out by the government could be a solution to ease the burden on the community due to the adjustment of VAT rates. However, he emphasized the importance of the sustainability of this policy.
“In general, the economic stimulus package announced by Coordinating Minister for the Economy Airlangga Hartarto can be an initial solution to ease the burden on the community, especially in meeting basic needs,” said Yogi.
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