Airlangga Ensures VAT Tariffs Increase To 12 Percent Next Year

Coordinating Minister for Economic Affairs Airlangga Hartanto ensured that the increase in value added tax rates (VAT) to 12 percent would be enforced next year.

The increase in VAT is regulated in Law Number 7 of 2021 concerning Harmonization of Tax Regulations (HPP). In this regulation, the current VAT rate of 11 percent can increase to 12 percent no later than January 1, 2025.

Airlangga said the provisions that had been formulated and issued in the government of President Joko Widodo (Jokowi), including regarding the adjustment of VAT rates, would be continued in the next government.

Furthermore, Airlangga said, the community had made a choice for the leaders to continue Jokowi's program. So that the provisions for the increase in VAT taxes can be implemented.

"We see that the Indonesian people have made the choice that their choice is sustainable. If it is sustainable, of course, the various programs launched by the government will continue. Including the VAT policy," Airlangga said at a press conference at the Coordinating Ministry for the Economy, Jakarta, Friday, March 8.

Airlangga said that a more detailed discussion of the 2025 state revenue and expenditure budget (APBN) would be carried out after the official results of the 2024 presidential election vote count were announced by the KPU.

The implementation of the 2025 State Budget Program is the upcoming government. So the next government will get certainty after the KPU announcement. Of course, programs that need to be included in the APBN are programs run by the next government," he explained.

For your information, in Law Number 7 of 2021 a number of goods subject to VAT include food and drinks, both served in hotels, restaurants, restaurants, stalls, and the like, including food and drinks, both consumed on the spot or not.

"Including food and drinks handed over by the boga or catering service business, which is an object of regional taxes and regional levies in accordance with the provisions of laws and regulations in the field of regional taxes and regional levies," reads Article 4A paragraph 2 point c.

In Law Number 7 of 2021, there are a number of items that are exempt from VAT. Among them are money and gold bullion for the benefit of state foreign exchange reserves, as well as securities.