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How Customs helps Indonesia heal from the pandemic
In March 2020, Indonesia was burdened by the arrival of COVID-19, bringing difficult times for everyone. The troubles hitting health and the economy cannot be separated, especially when placed on a national scale.
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n March 2020, Indonesia was burdened by the arrival of COVID-19, bringing difficult times for everyone. The troubles hitting health and the economy cannot be separated, especially when placed on a national scale. Thankfully, the difficulties have now passed with the help of the government in numerous sectors. One form of assistance that tends to be overlooked is that from the Customs and Excise Directorate General.
Head of the Public Relations and Customs Counseling sub-directorate, Hatta Wardhana revealed that as a trade facilitator, customs played an active role in assisting the government to overcome the COVID-19 pandemic. Various facilities, innovations and the ease of services were provided to support this.
Throughout the pandemic, the needs of the people have been met not only through domestic production but also through imports. Based on Finance Ministerial Regulation (PMK) No. 92/PMK.04/2021, the government, through customs and excise, has provided an exemption from import duty on imports of goods needed to deal with COVID-19, so that domestic needs could be met and commodity prices stabilized.
“Through this incentive, the costs of imports are reduced, so that they can be diverted to increase the supply of other needs. This is one effort to accelerate the handling of the pandemic and to normalize economic activities, which in turn has an impact on the national economic recovery," explained Hatta.
Moreover, commodities are not the only resources that have been exempted, as Customs has also assisted in the transportation of imported vaccines for residents. This was realized through the provision of exemption from import duties and/or excise, the waiver of value-added tax and luxury tax as well as exemption from tax on imports (PPh 22), which is further regulated in PMK No. 188/PMK.04/2020.
With vaccination imports valued at Rp 719 billion added to the import of medical equipment at Rp 174 billion, the total cost of using import facilities is as much as Rp 893 billion (US$11.67 billion) in 2022 alone. Most of the cost has been dominated by vaccines, at 81 percent, followed by medical equipment for the remaining 19 percent, including medicines, PCR test kits, oxygen cylinders and respiratory therapy devices (oxygen concentrators, generators and ventilators).
The number pales in comparison with those transported during the period of November 2020 to March 2022, when customs assisted in the import of as many as 506.60 million doses of vaccines, comprising 153.90 million bulk doses and 349.59 million finished doses. The import value reached Rp 47.40 trillion, and the value of exemption from import duty and tax on imports was Rp 8.94 trillion.
“Customs and the LNSW [National Single Window Agency] have built an Emergency Response Licensing portal, which is a one-stop service that makes it easy for facility users to apply for exemption from import duty,” said Hatta on the accelerated services developed during the pandemic.
“Furthermore, there is the BNPB [National Disaster Mitigation Agency] Dashboard, a system that assists facility users in monitoring the progress of the BNPB recommendation submission process, which is a requirement for submitting medical equipment imports for the handling of COVID-19. Customs and excise itself has built the COVID-19 Response Application System, a web-based application for the issuance of the Finance Ministerial Decree [SKMK] exemption from import duties and government-borne import duties [BM DTP],” Hatta added.
The BM DTP is a payable import duty facility paid for by the government on imports of goods for industrial sectors that are affected by the pandemic, the provisions of which have been regulated in PMK No. 134/PMK.010/2020.
Directorate General of Customs and Excise, together with Fiscal Policy Agency (BKF) and Directorate General of Taxes, conducted a survey on the fiscal and non fiscal stimulus programs for economic recovery in 2021. Data revealed that 64 percent of respondents agreed that the biggest benefit of the incentives were liquidity benefits, followed by 22 percent operational benefits and 14 percent production benefits. Meanwhile, in a survey based on the type of facility, 89 percent of respondents stated that the most beneficial incentive was on the importing of medical devices.
“Understand all procedures and take advantage of the facilities! If you need further information, you can contact the Bravo Customs contact center at 1500225. Let's help the government together in this recovery effort!” Hatta said, as he encouraged everyone to use the facilities provided for the good of the community.
