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Govt to phase out COVID-related tax incentives by year-end
The Finance Ministry has said that the government is phasing out the many tax incentives it introduced to buoy consumers and producers during the coronavirus pandemic.
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Fiscal Policy Agency (BKF) head Febrio Nathan Kacaribu (Courtesy of/FE UI)
T
he government has announced that it is discontinuing many of the tax incentives it introduced during the pandemic by the end of this year.
Febrio Nathan Kacaribu, the head of the Finance Ministry's Fiscal Policy Agency (BKF), said on Tuesday that many industries had experienced a rebound, followed by a decline in the unemployment rate.
Gross domestic product (GDP) grew 5.01 percent year-on-year (yoy) in the January-March period, according to Statistics Indonesia (BPS). Meanwhile, the unemployment rate declined to 5.83 percent in February from 6.26 percent during the same period last year.
“If economic growth has returned to 5 percent, what else do you need?” Febrio told reporters after a meeting with the House of Representatives Budget Commission.
“I think we already have enough incentives,” he added.
Read also: Govt to start taxing P2P lending, e-wallet services
The decision comes amid increasing global economic uncertainty. Russia’s invasion of Ukraine and the retaliatory sanctions imposed by Western countries have disrupted global supply chains and driven up energy and commodities prices. At the same time, monetary tightening in many countries is impacting global growth and could even lead to another recession.
