MTI Says There Is A Potential Of IDR 18 Trillion From The APBD That Can Be Used For Transportation

Rupiah illustration (Photo: dock. Antara)

JAKARTA - The Indonesian Transportation Society (MTI) said there is a potential of IDR 18 trillion from local government funds (Pemda) that can be used for the development of the transportation sector. This potential refers to the rules that have been previously signed.

The regulation in question is Government Regulation (PP) Number 35 of 2023 concerning general provisions of regional taxes and regional levies.

Chairman of MTI Tory Damantoro explained that in PP No. 35 of 2023, there is an arrangement for the use of 10 percent of motor vehicle tax revenue that must be used by the Regional Government for transportation improvement.

"There is a crucial policy, namely that the 10 percent allocation of motor vehicle taxes must be used for the transportation sector. MTI encourages the Ministry of Home Affairs to assist the Ministry of Transportation to disburse so that the 10 percent can be used," said Tory in the 2023 MTI Year End Note, in Jakarta, Wednesday, December 27.

Tory posted that nationally based on tax data, MTI noted that the existence of this PP would open fiscal space for Regional Governments to finance development and subsidies for urban public transportation services.

"Last year, TKD (Transfer to the Region) had Rp180 trillion, if 10 percent for public transportation, it means there is Rp18 trillion," he said.

According to Tory, this step has begun to be carried out by the Pekanbaru City Government, Riau. The Pekanbaru City DPRD, with the help of the Riau Region MTI, has succeeded in preparing a General Transportation Regional Regulation which allocates an annual APBD budget of 5 percent for public transportation financing.

Therefore, Tory said that MTI asked the central government to support the local government's commitment to make public transportation a basic mandatory service with the APBD allocation.

"MTI urges the Ministry of Home Affairs and the Ministry of Finance to support the commitment of regional government funding by making public transportation a basic mandatory public service with a fixed APBD allocation percentage every year," he said.