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The Job Creation Law Develops Local Industries

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By: Ahmad Prasetyo )*

The Job Creation Law which was inaugurated last October brought positive changes. Not only in the manpower sector, but also in developing regional industries. There are many new regulations that can make regional industry more advanced and can move up to the level of a national, even international industry.

Industry is something that can cause Indonesia to progress, because if many business people have an industry (even though they are small), they will open jobs for other people. However, so far industrial development, especially in the regions, is still stagnant. Because there are regulations that actually make it difficult to progress, for example the problem of the complexity of business licensing.

The government is trying hard to make regional industries develop as well, so that they can be at the same level as the industry in Jakarta and develop into a national industry. If necessary, level up to become an international industry. Therefore, a Job Creation Law was drafted which could regulate regional industries to be more advanced. This law cuts down a dizzying bureaucracy.

One of the things that was changed by the Job Creation Law was the removal of the nuisance permit rule. Director General of Fiscal Balance of the Ministry of Finance Astera Prmanto Bhakti stated that the nuisance permit retribution was abolished. Nuisance permit aka HO is a letter that states there are no objections and disturbances to the location of the business being carried out.

If there is no nuisance permit levy, industrial owners in the regions will no longer have a headache. Because there is no collection of money that must be given to the Dinas, so that their business runs smoothly. They can use the money for other purposes, such as increasing business capital or developing product research costs.

The elimination of levies for local industries is proof that the Job Creation Law is very pro towards the little people. Because the industrial average in the regions is controlled by the lower class of society. They are happy to be noticed by the government. So that the aspiration to change into the upper class or at least the middle class, can be quickly achieved.

Apart from eliminating the HO permit retribution, the Job Creation Law also regulates fiscal incentives to the regions, which will be regulated by the regional head. Fiscal intensive means the use of state expenditures and revenues to influence economic conditions. Examples are tax intensive and import and exit duty intensive.

When taxes in the regions are given intensively, small entrepreneurs will be relieved, because the nominal is reduced. The government understands they are in a critical period due to the Covid-19 pandemic, so they are given assistance in the form of tax deductions. This tax intensive was also carried out in 2009, and the result was an economic growth of 6%.

If regulations in the regions are changed by giving fiscal incentives and removing HO permits, it will convince foreign investors to enter Indonesia. Moreover, in the Job Creation Law there is an investment cluster that eases their steps in investing and doing business in our country.

If there are foreign investors entering, it is hoped that they will promote the industry in the regions. Smbiosis mutualism between investors and entrepreneurs will make great collaborations. When there is an injection of investor funds, business people can develop their business by creating new branding, beautiful and instagrammable product packaging, and product variations.

Businessmen in regional industries can also create websites to market their products, and even order applications to make customers closer to them. All of these marketing steps are great for marketing a product to make it more attractive to more people. However, it also requires funds that are not small, which of course is provided by investors.

The Job Creation Law encourages the advancement of industry in the regions because there is a fiscal intensive policy that greatly eases young entrepreneurs. In addition, the government removed the HO permit, so that there are no more costs to pay for the disturbance permit. The Job Creation Law also opens opportunities for foreign investors to invest in businesses in regional industries, because there is an investment cluster.

)* The author is a United Muslim Millennial contributor

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