President Joko `Jokowi` Widodo demanded evaluation on the effectiveness of several policies on tax incentives in a bid to boost the investment. Finance Minister Sri Mulyani Indrawati conveyed the statement today, November 21, in a press conference which was held after the closed meeting on investment and tax issue in Bogor Palace, West Java.
Sri Mulyani said the government had granted tax incentives based on Special Economic Zones (SEZ), industrial estates, and free trade zones among others. “Mr. President asks for strict evaluation on the effectiveness of these incentives,” she noted.
The government, Sri mentioned, had provided multiple tax incentives for business sectors, including the tax holiday.
Throughout April up to November 2018, tax holiday had attracted new investment worth Rp162 trillion which came from nine companies comprising of eight new investments and one expansion of investment.
The new investments were estimated to employ 8,000 Indonesian workers. “We are urged [by President Jokowi] to simplify the process and evaluate the effectiveness of the tax holiday to boost investment,” said Sri Mulyani.
Earlier, deputy chairperson of Chamber of Commerce and Industry (Kadin) Shinta W. Kamdani said incentives for domestic industry such as tax holiday as ruled on the 16th economic policy package were believed to raise higher interests on the investment in Indonesia. However, she reminded a possible lawsuit filed by partner countries via the World Trade Organization (WTO) over tax holiday for the export-oriented industry.