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One million Jakartans freed from property taxes
The Jakarta city administrationâs new taxation policy, will free about one million Jakartans from having to pay land and building taxes (PBB)
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he Jakarta city administration's new taxation policy, will free about one million Jakartans from having to pay land and building taxes (PBB). The exemption affects those whose properties are valued at less than Rp 1 billion (US$ 69,000).
'Accordingly, we will reduce revenue targets from land and building taxes to Rp 7.2 trillion from Rp 8 trillion,' said head of City Taxation Agency Agus Bambang Setyowidodo on Thursday as quoted by tempo.co. He estimated, however, that with the new policy, revenue from the property taxes would fall by some Rp 400 billion.
Governor Basuki 'Ahok' Tjahaja Purnama said that the new policy was designed to help ease the economic burden on low-income families caused by the on-going economic slowdown.
Agus said that his office's digital database would automatically decipher which residents would qualify for the tax exemption. According to Agus, the city has now collected Rp 6 trillion in axes this year, about 73 percent of the year's target.
Commenting on the new policy, chairman of the City Council's financial commission Santoso said that he did not agree. 'Don't scrap the taxes. It contributes to the city revenue,' he said, calling on the city administration to instead revise the tax rate.
Another city councilor Selamat Nurdin criticized Governor Ahok for not consulting with the City Council before the announcement. He said that the policy would affect the city's revenue. 'The assessment should have been detailed, rigid and acute,' said Selamat, a member of the City Council's financial commission.
The discourse around eliminating land and building taxes initially came from Agrarian and Spatial Minister Ferry Mursyidan Baldan, who said that non-commercial buildings owned by low-income families should not be targeted for taxation.
Meanwhile, a spokesman for the Agrarian and Spatial Ministry Gunawan Muhammad said that his office had not found a legal basis for the elimination of the taxes. 'We are still studying [the new policy] to find the reasoning behind it,' he added. (bbn)(++++)
