T

he Indonesian Chamber of Commerce and Industry (Kadin) has criticized a number of government policies that it claims have been ineffective in tackling the current trend of weak economic growth.

Current economic policies were incapable of supporting overall businesses as they put a strong emphasis on only specialized sectors and created obstacles for doing business in others, Kadin chairman Suryo Bambang Sulisto said, citing tax policy and export and import duties as examples.

The new administration under President Joko '€œJokowi'€ Widodo has set a high tax revenue target this year to obtain more fiscal space and hopefully expand the economy. At the same time, the government maintained export bans on mineral ore and imposed high taxes on processed mineral products introduced in 2014.

'€œThose policies seemed to be beneficial for a while, but the output has not gone well. Therefore, we hope that the president can orchestrate better preparation and order his ministers to create [more] business-friendly regulations,'€ Suryo recently said.

Business people as well as economists earlier raised concerns over the official tax revenue target of
Rp 1.49 quadrillion (US$104.7 billion) for 2015, up around 30 percent from last year'€™s take. Described by many as '€œunrealistic,'€ the ambitious figure has been predicted to fall short by hundreds of trillion of rupiah resulting from weak outcomes in the initial months of this year.

Indonesia'€™s tax income stood at Rp 555.2 trillion in the first half of the year, or only 37.3 percent of the revenue target as the economy slowed and the ratio of tax payers was still low. 37.3 percent made this year the lowest level in terms of income collection against the initial target number seen in the same period over the past four years. Usually, the percentage level recorded at this time of the year reached between 42 percent and 44 percent of their annual targets.

In a change to its previous position, Kadin expected the government to revoke the mineral export ban and lift import duties on mineral concentrates, which had been expected to serve as a disincentive for overseas shipment and help spur development of local refineries and smelters.

Suryo said that as both policies threatened to hurt both foreign and domestic direct investment, and had caused some negative developments in the economy, such as massive layoffs in the country'€™s mining sector, they should be lifted.

Coordinating Economic Minister Sofyan Djalil said that the government had agreed to create open forums with the private sector to facilitate discussions between the two parties.