Ventura Capital Company Reveals 12 Percent VAT Increase Has No Effect On Portfolio

JAKARTA - venture funding companies such as Init-6, OCBC Ventura, and Trihill Capital assess that the increase in Value Added Tax (VAT) rates from 11 percent to 12 percent in 2025 will not affect the company's portfolio, especially on funding in the retail and consumer sectors.

Venture Partner from Init-6, Rexi Cristopher said that based on the results of the analysis that had been carried out, the 11 percent increase in VAT to 12 percent would only be temporary.

"Because yes, no matter what, we can see that the consumer sector is still growing, what I mentioned earlier is Indonesia, it's very consumptive to the person. Maybe if you go up to 1 percent VAT, maybe shake a little, just after that, it's normal again," said Rexi at the Consumer Market Update event, Monday, November 18.

According to Rexi, this can be seen from the consumptive nature of the Indonesian people so that the increase in VAT from 11 percent to 12 percent does not have a significant impact on the company's portfolio.

Adapaun Init-6 has provided funding support to the consumer and retail sectors including the Torch and UMA Women.

"Portfolio Init-6 in the consumer sector is also diverse, recently Init-6 invested in the Lifestyle Torch brand which targets to own 50 store outlets in 2029 and expand market reach outside Indonesia. Init-6 also announced a strategic investment in UMA Women, sanitary brand and organic women's health to support the sustainability of organic feminine products that can be accessed inclusively and widely," he said.

On the same occasion, OCBC Ventura's Portfolio and Advisory Head, Dyah Trisnawaty said that the increase in VAT to 12 percent had little effect on the company's portfolio.

"Because actually, if we look at Indonesia, maybe the community was very consumptive as well and happy that new items appeared or something was there, there was a term FOMO right away. So it's rich, for example, there is a new restaurant that wants to come right away, there are new products that want to try immediately. So if we look at it, it won't be effective," he said.

Dyah said that for 2024 his party had funded three retail businesses including Vilo, FTL Fitness and Kopitagram which had met important criteria in scalability, sustainable growth, and strong economics units.

"We believe, with the new government and the promising economic prospects of Indonesia, this is the right time and momentum to encourage funding for the innovation and growth of the retail sector," he added.

Similarly, Trihill Capital VP of Investments, Varianus Ian Sulaiman explained, the increase in VAT to 12 percent has not become a separate concern from the company.

"But from our observations, no one has seen that the initiative (increased with VAT) will have a very negative impact on business. So from our perspective, we are talking about the 2025 budget and so on, this is not a special consideration," he explained.

In addition, Ian also announced two Trihill Capital investment portfolios in the retail sector, namely Se'Indonesia and Hiboo Baby.

"As an early investor in Indonesia and Hiboo Baby, we are proud to see how these two companies have not only achieved business success, but also have made a real contribution to society. Throughout Indonesia has succeeded in answering the challenge of accessing quality protein consumption, while Hiboo Baby has provided innovative solutions for the needs of baby skin care at affordable prices," he concluded.