Sandiaga Uno: The 12 Percent VAT Increase Plan Hasn't Caused A Turbulence In The Tourism And Creative Economy Sector

Minister of Tourism and Creative Economy (Menparekraf) Sandiaga Uno. (Photo: Doc. Antara)

JAKARTA - Minister of Tourism and Creative Economy (Menparekraf) Sandiaga Salahuddin Uno opened his voice regarding the plan to increase the value added tax rate (VAT) to 12 percent in 2025.

Sandiaga Uno said the plan to increase taxes would not cause significant turmoil in the tourism sector and the creative economy (ekraf) in the country.

"I can answer that we have done this in stages and God willing, the impact will not cause much turmoil," Sandiaga said at The Weekly Brief with Sandi Uno in Jakarta, quoted on Tuesday, March 26.

He added that the Indonesian Hotel and Restaurant Association (PHRI) had also predicted that the 12 percent VAT rate increase would not cause much turmoil.

"The most important thing right now is how national economic growth grows so that the community's obligations to taxes can be carried out properly," he said.

According to Sandiaga, the plan to increase the tax rate will later strengthen the national economy. So, of course, people can improve their welfare.

"The business world does not need to worry because we have carefully calculated (plans to increase VAT rates) in this parekraf sector. Hopefully we can get through without turmoil," he added.

Previously reported, the government plans to increase the value added tax rate (VAT) to 12 percent by 2025. The tariff adjustment has been stated in Law Number 7 of 2021 concerning Harmonization of Tax Regulations (UU HPP).

Coordinating Minister for Economic Affairs Airlangga Hartarto said the decision to increase VAT to 12 percent by 2025 would wait for the next government's decision, namely the elected presidential and vice presidential candidate Prabowo Subianto-Gibran Rakabuming Raka.

"Regarding VAT, the HPP Law. So, so far the HPP Law has sounded this way, but what is decided depends on what the government's program will be," said Airlangga after the Inclusive Financial National Council Coordination Meeting (DNKI) on Friday, March 22.

According to Airlangga, if the new government approves to implement a 12 percent VAT tariff policy at the beginning of next year, the policy will later be included in the 2025 State Budget Law.