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Tax amnesty to have positive impact on IDX
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Indonesia Stock Exchange (IDX) president director Tito Sulistio talks to journalists in Jakarta on Friday. (JP/Ivany Atina Arbi)
T
he Indonesia Stock Exchange (IDX) announced on Friday that the implementation of the tax amnesty would have positive impact on the country’s stock market.
IDX president director Tito Sulistio agreed with the government’s projection of a Rp 165 trillion (US$12.54 billion) windfall from the implementation of the Tax Amnesty Law.
“It’s simple. With the implementation of the tax amnesty, there will be additional liquidity that will lower the interest rate. Universally, if the interest rate falls, the stock market increases,” Tito told journalists.
The country’s benchmark stock price index, the Jakarta Composite Index (JCI), gained 0.73 percent to close at 5,016 yesterday.
According to the Tax Amnesty Law, the redemption rate for declared assets repatriated for investment is set at 2 percent of their net asset value. Meanwhile, declared assets that are repatriated but are not for investment purposes will be subject to a 4 percent penalty.
Bank Indonesia deputy governor Perry Warjiyo said bonds, stocks, and corporate bonds were financial instruments that could absorb the repatriated funds. (vny/dan)
