By: Ahmad Pahlevi )*
The birth of the Omnibus Law Act as a way to strengthen the national economy is increasingly awaited. The government and the community hope that with the coming of the Omnibus Law, which is getting faster, it can provide better business climate certainty and benefit all parties, both laborers and employers.
In the government’s effort to boost investment, reduce imports and accelerate exports, the Omnibus Law scheme will soon be implemented. The simplification scheme consists of 2 laws related to job creation and taxation. The Omnibus law is needed to cut regulations overlapping, so this effort requires support. Apart from the role of the government and the House of Representatives to keep the Omnibus Law Act not as a “protective wing” for rogue entrepreneurs. The reason is, if this happens it will cause a market and community mistrust.
The Omnibus law itself is a law (Act) created to resolve major issues by revoking or amending several laws at once, so that they become more straightforward and simpler. The government is currently finalizing the omnibus law whose ultimate goal is to boost national economic growth. There are three things that are targeted by the government through the implementation of this scheme, namely the Law on taxation, employment creation, and also the empowerment of MSMEs.
President Jokowi hopes that the Omnibus Law concept with enthusiasm to overcome the chaotic legal system that exists in Indonesia, has even become popular as a hyper-regulation country.
According to the Center for Law and Policy Studies, during the administration of President Jokowi until November 2019 there were up to 10,180 regulations in various forms. This scheme is predicted to be a legal umbrella that can solve everything.
Minister of Law and Human Rights Yasonna H. Laoly has targeted two Draft Omnibus Law Notices discussed by the DPR in January 2020. The two Omnibus Laws are the Employment Copyright Act and the Taxation Law. The submission process to the DPR will be conducted after the parliament holds a session.
The Omnibus Law Cipta Karya is specifically designed to create as many employment opportunities as possible, including the protection of Micro, Small and Medium Enterprises (MSMEs), also encourage the growth of MSMEs, boost investment growth, and boost export efforts.
It is reported that there are at least 74 laws that must be considered to look for laws that hamper, then they will be revised. President Joko Widodo has also ordered the ranks of the Ministry of Law and Human Rights to travel to the regions to conduct socialization related to the Omnibus Law.
The Omnibus Law’s focus on job creation includes; amendments to procedures related to wages and severance pay for workers; Simplification of business licensing; Imposing administrative sanctions along with the elimination of criminal sanctions; Ease and legal protection; including research and innovation documents, Ease of government projects; and also the convenience in KEK.
While the focus of the Omnibus Law in the taxation sector is; gradual reduction of corporate income tax rates by 22% (for the period 2021-2022) and 20% (for 2023 and thereafter); Reduction in PPh rates for publicly traded entities (about 3 percent of general rates); Elimination of income tax on domestic dividends insofar as it is invested in the Republic of Indonesia territory; Territorial system for certain income abroad; Electronic transaction tax; Rationalization of local taxes; Arrangement of tax facilities (including; tax holidays, super deduction, PPH KEK and also PPH bonds); plus rearrangement of tax, customs and excise administration sanctions.
Previously, Research Center for Law and Policy Studies (PSHK) Nur Sholikin said, there were a number of things that President Joko Widodo must pay attention to before implementing the Omnibus Law Law. There are at least five things that can be done to ensure the Omnibus Law is effective and will not be misused later.
The first and foremost point is that the House of Representatives (DPR) together with the government must involve the public in each phase of its preparation.
Second point, the DPR and the government must conduct transparency in providing every information on the development of the formulation of the Omnibus Law Act to the general public,
Third, the compiler is obliged to map regulations relating to detail.
Point Four, makers must be strict in harmonizing, both vertically with higher regulations and horizontally with rules that are valued as equals.
Last or fifth point, the maker must do a number of previews before the Act is passed. This preview is prioritized to assess the impact that is likely to arise from the law that will be passed later.
Sholikin also stressed the fulfillment of the principles of transparency, participation, and accountability. If not, the preparation of the Omnibus Law will potentially lead to new problems such as public rejection, the substance of the rules that deny public rights, to issues related to implementation.
Furthermore, the President also instructed the Attorney General, the National Police, and BIN to see the impact of the Ornnibus Law Bill. Therefore, the discussion of the Omnibus Law Bill must be carried out together with a number of stakeholders. In addition, Jokowi has also asked his staff to prepare regulations derived from the Omnibus Law. Namely, in the form of draft government regulations, revisions to PPs, and draft regulations.
According to Jokowi, everything must be done in parallel not only to make the bill and its implementation regulations a solid regulation, but also to make it easier for stakeholders to understand the great architecture of the omnibus law being worked on.
Support regarding efforts to implement the Omnibus Law scheme is necessary. Considering the impact will be able to make overlapping and the complexity of bureaucracy and regulation will fade. It is not only able to alleviate poverty because of opening employment on a large scale, but also improve Indonesia’s investment climate in supporting national economic development.
)* The author is a social political observer