Import duty to decline, but tax may rise

Import duty revenue will likely decline this year with the implementation of the free trade agreement between ASEAN countries and China starting on Jan. 1, the Directorate General of Customs and Excise said Monday.

But lower import duty as a result of the agreement will reduce the cost of the real sector, which will in turn raise the business profit to be taxed by the government, said technical director Agung Kuswandono in a discussion on the 2010 state budget.

The Finance Ministry expects the directorate general can collect Rp 19.57 trillion (US$2.09 billion) in import duty this year, up 5.1 percent from Rp 18.62 trillion in 2009.