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December 31, 2024 | 10:08 pm
TEMPO.CO, Jakarta - The Maklumat Juanda Community demanded the government not burden the people by canceling the implementation of the 12 percent value-added tax or VAT rate.
"We demand that the plan to increase the VAT to 12 percent be canceled," said one of the members of the Maklumat Juanda Community, John Muhammad, while reading out the demands on behalf of the community at Gruham Coffee & Bistro, South Jakarta, on Tuesday, December 31, 2024.
According to John, the 12 percent VAT increase will make people's lives more difficult because of the high rates that will be applied. He believes VAT is an unfair instrument as it also targets the poor.
"Burden the people seems to be the easiest shortcut," he said.
The Presidium of the Indonesian Green Party or PHI said that raising the VAT was not the right step to maintain economic growth amid budget deficit, rising debt, and bankruptcy of goods and services companies.
"The public will lose purchasing power," John said.
The demand also highlighted the government's large projects, which are considered wasteful as they are not necessarily needed by the people. Budgetary waste, John said, also occurred due to the fat structure of the government and the tendency to enrich the elite ranks, such as official trips and the discourse on providing pensions for unit sources.
"This is what we must also oppose," he said.
The Juanda Information Community also called on the entire community to unite in rejecting the government's plan, which is seen as adding to the burden of life. "We will not stop fighting for this," he said.
On the other hand, the Institute of Economic and Financial Development (Indef) stressed there was a slowdown in consumption and a weakening of people's purchasing power. BPS data shows that Indonesia experienced five months of deflation from May to September 2024.
The decline in purchasing power can be seen from the consumption growth rate from Q1 to Q3 in 2024, which grew lower than economic growth. In addition, Indef assessed that there had been no rapid stimulus and incentives to improve people's declining purchasing power. Thus, the 12 percent VAT is not in line with economic conditions in Indonesia.
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