The House of Representatives Commission VI overseeing industry and state companies has urged the Joko âJokowiâ Widodo government to take a firm stance to decrease the price of subsidized Premium fuel for the benefit of the public
he House of Representatives Commission VI overseeing industry and state companies has urged the Joko 'Jokowi' Widodo government to take a firm stance to decrease the price of subsidized Premium fuel for the benefit of the public.
'We are asking the government to not just study the possibility of lowering fuel prices, but to actually do it. Even though the government will lose revenue, the public will gain more through affordable fuel,' Commission VI chairman Achmad Hafisz Tohir told The Jakarta Post on Tuesday.
He explained that in terms of revenue, state fuel provider Pertamina would not be significantly affected by the price change as its business operations did not depend on fuel sales alone, but also on the production of lubricants, natural gas and condensers.
Commission VI deputy chairman Dodi Reza Noerdin offered another option wherein the government could decrease fuel prices without revenue being significantly reduced: lower the 10 percent value-added tax (VAT) and the 5 percent fuel tax (PBBKB).
'Even though the tax revenue will decrease, eventually we will see a multiplier effect taking place in the long run in terms of logistics and consumption,' he said.
The House's comments came after President Jokowi told Pertamina last week to consider to possibility of cutting fuel prices to aid the people's weakening purchasing power amid the domestic economic slowdown. ' JP/dyl
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