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Prabowo, Gibran would consider taxing SMEs to boost state revenue
A campaign representative said the candidates’ policies could increase the national taxation ratio to 18 percent by 2029.
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Presidential candidate Prabowo Subianto (right) and running mate Gibran Rakabuming Raka walk into the Jakarta Convention Center ahead of the second 2024 election debate on Dec. 22, 2023. (Antara/M Risyal Hidayat)
The campaign team for presidential candidate Prabowo Subianto and his running mate Gibran Rakabuming Raka says the candidates would consider taxing small and medium enterprises (SMEs) to boost state revenue if elected.
Businessman Erwin Aksa, who is deputy chairman of the Prabowo-Gibran campaign team, said the pair would implement a number of new taxes and excises to increase state revenue.
SMEs, he said, would be subject to parts of that tax extensification.
"The tax base still needs to be expanded. Many business owners still don’t pay taxes. How about we encourage informal SMEs to report their taxes?” said Erwin at a campaign event on Wednesday, as quoted by CNBC.
Erwin was optimistic that the candidates’ policies could increase the national taxation ratio to 18 percent by 2029. A higher tax ratio, he added, would allow Prabowo and Gibran to fund their flagship programs, such as the free lunch and milk program for children in school and mothers, which is estimated to require some Rp 400 trillion (US$25.7 billion).
"We will invest in nutrition so that in the next 10 years, [the children] can work at high-salary companies. This is what we want to achieve from the free lunches and milk [program]. It is a long-term investment that we can enjoy in the following 10 to 20 years," Erwin said.
In addition to taxes, Erwin said the pair would expand excise revenue if elected, including by taxing sweetened beverages. He said sweetened beverages had caused many Indonesians to develop diabetes.
Another of the pair’s strategies is to increase taxes on polluting motor vehicles and provide incentives for electric vehicle (EV) owners.
"We certainly want to encourage [sales of] electric cars to increase job opportunities in the automotive industry. How can EV sales increase if we don't discourage carbon-emitting vehicles?" Erwin said.
Erwin is the leader of Bosowa Group, a business conglomerate based in Sulawesi, and is a member of the Golkar Party.
He is also the nephew of businessman and former vice president Jusuf Kalla, who is supporting Anies Baswedan and his running mate Muhaimin Iskandar for the 2024 presidential election.
