Affirming 12 Percent VAT Only For Luxury Goods, Cak Imin: President Prabowo Always Sides With The People

JAKARTA - Chairman of the National Awakening Party (PKB) Muhaimin Iskandar emphasized the increase in value added tax (VAT) to 12 percent as of January 1, 2025, only for luxury goods.

"The 12 percent VAT rate only applies to Luxury Goods VAT (PPnBM). Apart from that, VAT remains 11 percent. The basic needs of the wider community such as rice, meat, eggs, vegetables, milk and other services such as education, health, and transportation are still exempt from VAT. This is a form of President Prabowo's alignment with the people," said Cak Imin in his statement, Tuesday, December 31.

Muhaimin believes this step can realize one of the Asta Cita Presiden Prabowo, namely equitable economics and poverty eradication.

"PKB is grateful for President Prabowo's commitment to the welfare of the nation, through a fair tax system that encourages equitable distribution and economic growth for community empowerment," said Cak Imin.

Coupled with the stimulus package worth IDR 38.6T which remains in effect, Muhaimin is optimistic that the government's target of achieving extreme poverty of 0 percent by 2026 and reducing the national poverty rate by 5 percent can be achieved.

"The global economic challenge will be increasingly difficult in 2025. Here, the government is here to reduce the burden on the community with the Stimulus Package, such as the exemption of PPH for MSMEs with an asset of less than Rp. 500 million, PPH21 incentives for workers with salaries below Rp. 10 million per month, 10 kg of rice assistance per month for 16 million beneficiaries, and others. This will definitely ease the burden on the community while accelerating poverty alleviation," said Cak Imin.