Deputy Speaker Of The House Of Representatives Values 12 Percent VAT Policy For Luxury Goods Fills A Sense Of Justice

Deputy Speaker of the Indonesian House of Representatives Coordinator for People's Welfare Cucun Ahmad Syamsurijal. (Photo: ANTARA)

JAKARTA - Deputy Speaker of the Indonesian House of Representatives Coordinator for People's Welfare, Cucun Ahmad Syamsurijal, assessed that President Prabowo Subianto's decision to impose a value added tax (VAT) rate of 12 percent on luxury goods groups should be appreciated.

According to Cucun, Prabowo's decision is a tangible manifestation of the government's commitment to maintaining people's purchasing power, strengthening industrial resilience, and improving people's welfare.

"This decision reflects the sensitivity to the economic conditions of the wider community, especially the middle and lower class, which relies heavily on the stability of the prices of goods and basic necessities," said Cucun as quoted by ANTARA, Wednesday, January 1, 2025.

In addition, the Deputy Chairperson of the DPP National Awakening Party (PKB) assessed that the policy had also provided a sense of justice for the community, especially the lower class of the upper class.

According to him, this policy also provides space for industry players to continue to grow and contribute to the economy.

"I think the President's decision on VAT is 12 percent correct. How the target is not general, but only for the upper class. So, this policy actually creates justice for the community, which is unfair if the owner of luxury goods, who owns planes, houses like palaces, taxes are the same as the lower middle class who owns motorbikes," said Cucun.

Furthermore, Cucun said, in an uncertain global economic situation, the stability of tax rates for non-luxury daily necessities and services will help domestic industries maintain productivity and competitiveness.

In addition, this avoids the potential domino effect on the price of other goods that can burden the community.

The implementation of the increase in VAT rates is only on luxury goods, such as private jets, cruise ships, and high-value properties, showing a fair approach in tax policies.

Taxes on these items deserve to be increased, considering that consumers come from people who have high economic capacity.

This also gives a signal that the government remains committed to the principle of social justice and supports a fair tax system.

This policy also reinforces the government's vision not only to pursue economic growth but also to ensure that people's welfare is a top priority.

"Through this decision, the government under the leadership of President Prabowo Subianto has shown concrete efforts in maintaining the economic stability of the community, supporting the resilience of the national industry, and building a foundation for improving people's welfare. This step is clear evidence that fiscal policy can be an instrument to create harmony between the interests of the state and the welfare of the people," he said.

Cucun also appreciated the government's steps to provide stimulus packages in the form of rice assistance, discounts for electricity tariffs, and labor-intensive industrial financing.

"President Prabowo's steps in providing stimulus to the economy through assistance and subsidies to the community are very appropriate to continue to maintain his purchasing power amidst high economic uncertainty," said Cucun.