Director General of Taxes Says 12 Percent VAT Imposed on Some Goods and Services

December 22, 2024 | 09:12 pm

TEMPO.CO, Jakarta - The Indonesian government has finally acknowledged that the increase in Value-Added Tax (VAT) next year will not be selectively applied only to luxury goods. According to the Director of Counseling, Services, and Public Relations of the Directorate General of Taxes of the Ministry of Finance (Ditjen Pajak Kemenkeu), Dwi Astuti, 12 percent VAT will be imposed on almost all existing goods and services.

"(12 percent VAT) applies to all goods and services that have been subject to a rate of 11 percent," said Dwi in a written statement, Saturday, December 21, 2024.

Dwi said that the exception to the VAT increase would only be applied to three types of commodity goods, namely wheat flour, industrial sugar, and Minyakita bulk cooking oil. All three, said Dwi, will be borne by the government for their tax increases. So that people will still pay VAT for the three goods of 11 percent.

"For these three types of goods, the additional VAT of 1 percent will be borne by the government or DTP, so that this VAT rate adjustment does not affect the prices of the three goods," he said.

Meanwhile, the price of basic goods is also confirmed to remain exempt from VAT. This provision is in accordance with Law Number 42 of 2009 concerning VAT. Where basic necessities such as rice, grain, corn, sago, soybeans, salt, meat, eggs, milk, fruits, and vegetables will not be subject to VAT.

Likewise, several services related to the interests of the general public will be given 0 percent VAT. Some of these include medical health services, social services, financial services, insurance services, education services, public transportation services on land and water, labor services and rental services for public flats and public houses.

"Thus, the less fortunate or disadvantaged community is already very protected with these various facilities," said Dwi.

Director of Public Policy Center of Economic and Law Studies (CELIOS), Media Wahyudi Askar, the list of tax-free goods mentioned is basically a category that has been regulated for a long time, and is not something new. Among them are the basic ingredients mentioned by Finance Minister Sri Mulyani such as rice, meat, fish, eggs, and vegetables.

"It's as if the narrative is that the government is providing incentives for basic goods that will not be subject to VAT. In fact, the VAT exemption for basic goods is already in Law 42 of 2009," he said.

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