Entrepreneurs Reveal Customers And Turnovers Are Starting To Drop Due To The Increase In Entertainment Taxes

Accounting for illustration (Photo: Unsplash)

JAKARTA - Black Owner's President Commissioner Kitchen Bar and Lounge Ehat Tio said that the application of the 40 percent to 75 percent entertainment tax directly affected his business where there was a decrease in turnover and even 40 percent of his customers fled because they considered the tax too high.

"Reservations and level of visits fell 30 percent to 40 percent," Karya told the media crew, Friday, January 26, 2024.

His efforts to convey the business he runs are even currently experiencing difficulties because many customers ask how much tax applies in that place before booking a place.

"People want a reservation, just ask if the tax is 40 percent or the old one?' If 40 percent is not finished," he explained.

ERADICATION says many customers want to hold events in place. But customers demand not to be taxed 40 percent.

"There is someone who wants to make an event at our place next month, he wants to book, but make a statement first the tax is not subject to 40 percent, if it won't be canceled," said Zafi.

According to Zahat, actually this 40 percent tax has not actually been implemented. But he can't imagine if the rules actually apply, they will definitely run out.

"How can it be when it is really determined, well, it can be after us," he said.

According to him, if the government continues to carry out this policy, the entertainment industry in the country will end. Because, the decline in turnover occurs in all business actors in the entertainment sector.

"Friends of entrepreneurs complain about everything, maybe there are more than 30 percent. (Now) judicial reviews take time, maybe a year, maybe maybe half a year. Before that breaks up, we are dead. Judicial reviews are granted, but we are already dead," he added.

According to you, entrepreneurs will find it difficult to increase tariffs or prices in the entertainment industry. "The current tax increase is 25 percent, it's already an extraordinary weight, net profit is at least 5 percent to 10 percent, after deducting all costs," he said.

"If people who don't understand think that the payment is not a company but a customer. But we know that customers will not be able to be lost, eventually the company that takes it to survive," he concluded.

For information, the increase in taxes for the entertainment sector at a rate of 40-75 percent comes into effect with the ratification of Law Number 1 of 2022 concerning Financial Relations of the Central Government and Regional Governments. The tax applies to a number of entertainment sectors such as discotheques, bars, karaoke and steam/spa baths.

Based on this regulation, the local government then issued derivative regulations in the form of regional regulations to determine the special entertainment tax rate in the range of 40-75 percent. DKI Jakarta is one of the regions that has set the special entertainment tax rate at 40 percent.