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Jakarta Post

Progressive vehicle tax won't matter much: Experts

  /   Thu, August 20 2009   /  02:02 pm

A progressive vehicle taxation system to be put into practice next year will likely prove insignificant in addressing Jakarta's woeful traffic jams, transportation experts said Wednesday. The new system will allow the government to impose vehicle tax progressively to people with more than one motorized vehicle. This system was proposed under the new regional tax law, which was passed Tuesday by the House of Representatives. Once the law takes effect, provincial administrations can impose a maximum vehicle tax of up to 10 percent of the vehicle value - double the previous ceiling of 5 percent - and apply higher taxes on the second and following vehicles owned by an individual. The new law sets taxes for the subsequent vehicles at between 2 and 10 percent. Details on the system will be regulated by each provincial administration. Critics contend the progressive tax...