Regarding The 12 Percent VAT Increase, Sri Mulyani Calls It Depending On The Next Government

Minister of Finance Sri Mulyani (Photo; Doc. Antara)

Minister of Finance Sri Mulyani Indrawati submitted the continuation of the plan to increase the value added tax (VAT) to 12 percent to the new government.

"For VAT, we leave it to the new government," said Sri Mulyani quoting Antara.

Previously, Coordinating Minister for Economic Affairs Airlangga Hartarto also said that the determination of an increase in value added tax (VAT) to 12 percent depends on the next government decision.

"Depending on the government (hereafter), what the program will be like," said Coordinating Minister Airlangga after the Inclusive National Board of Finance Coordination Meeting (DNKI) in Jakarta, Friday (22/3).

The plan to increase VAT of 12 percent has previously been stated in Law Number 7 of 2021 concerning Harmonization of Tax Regulations (UU HPP).

In the HPP Law, it is stated that based on Article 7 paragraph 1 of the HPP Law, the previous VAT rate of 10 percent was changed to 11 percent which was in effect on April 1, 2022, and again increased by 12 percent no later than January 1, 2025.

If the next government agrees to increase VAT, then the adjustment will be included in the 2025 State Revenue and Expenditure Budget Law (UU APBN).

"So so far, the HPP Law sounds like that, but regarding what the government decides, the government will include it in the APBN Law, so we'll see," he said.

Meanwhile, Indonesian Center of Reform on Economics (CORE) researcher Yusuf Rendy Manilet stated that the plan to increase VAT rates must be carried out at the right moment.

Efforts to adjust to momentum mean that the policy of increasing VAT rates needs to be adjusted to other government policies related to inflation or the target of increasing wages, so as not to have excessive consequences for the economy.

On the other hand, Yusuf said that actually the government can take the option to implement a progressive VAT policy, which means that VAT will not be single tariffs but multi-rates and be adjusted to the goods that will be consumed by the group. community income.