Airlangga: Property Tax Incentives Encourage Decent Occupancy For Urban Communities

Illustration. (Photo: Doc. Antara)

JAKARTA - Coordinating Minister for the Economy Airlangga Hartarto stated that incentives in the form of Government-borne VAT (DTP) for the property sector encourage the availability of decent housing for the people of Indonesia, especially in urban areas.

"The property sector continues to be encouraged so that it can actively contribute to the provision of decent housing for the community," said Coordinating Minister Airlangga Hartarto in Jakarta, quoted from Antara, Saturday, February 26.

Currently, the urban population in Indonesia has reached 56.7 percent and is estimated to increase to 66.6 percent in 2035 and will even reach 72.8 percent in 2045.

In addition, Coordinating Minister Airlangga said there were still 15.5 million people living in uninhabitable houses in 2020, so the property sector must be encouraged to contribute to providing decent housing.

The amount of VAT for DTP given is 50 percent for landed houses or flats with a maximum selling price of Rp. 2 billion and 25 percent for landed houses or flats with a selling price of over Rp. 2 billion to Rp. 5 billion.

Not only providing decent housing, the property sector also has a chain impact both in terms of forward-linkage and backward-linkage on 174 industrial sub-sectors.

This also makes the property sector have a high direct labor absorption capacity, even reaching 19 million people, so the government provides VAT incentives for DTP in the property sector by submitting the tax period from January to September 2022.

"The government remains committed to supporting the housing sector and the financial sector to synergize and be optimistic so that the national economic recovery can run well," said Coordinating Minister Airlangga Hartarto.