OJK commissioner for capital market supervision Hoesen explained the funds collected from various investors were accumulated in the RDPT, while the fund manager would create SPV.

The SPV can acquire assets such as property and infrastructure, or a certain percentage of a companies equity, he said, adding that acquired productive assets would generate revenue from their activities such as leasing office space or toll road payments.

The acquired firms would distribute the dividend to the SPV, and the SPV would further distribute dividends to RDPT holders.

Under the current system, tax was collected in each dividend distributed and therefore, RDPT holders have to pay taxes twice because there are two dividends that are distributed.

"We propose to eliminate the first dividend tax," Hoesen said over the weekend, adding that the proposal needed approval from the Finance Ministry.

"Hopefully we can eliminate double taxation in the first quarter of next year." (bbn)

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