Democratic Faction Asks 12 Percent VAT To Be Confirmed Only For The Upper Class

Secretary of the DPR RI Democratic Party Faction Marwan Cik Asan at the Parliament Complex, Jakarta. (ANTARA/HO-Democratic Faction)

JAKARTA - Secretary of the DPR RI Democratic Faction Marwan Cik Asan asked the government to ensure a Value Added Tax (VAT) of 12 percent for luxury goods and services, only for the upper class.

According to him, the 12 percent VAT policy selectively is the right policy in implementing Law Number 7 of 2021 concerning Harmonization of Tax Regulations (UU HPP). He also encouraged the government to ensure that VAT is pro-people.

"We support tax policies that must always prioritize the interests of the people as a whole to protect people's purchasing power and encourage economic equality," Marwan said as quoted by ANTARA.

He said the implementation of the HPP Law did not target the basic needs of the community, such as basic necessities, health and education and other basic needs.

According to him, this is one of the proposals from the DPR RI Democratic Party faction not to apply the HPP Law to basic commodities, education, health services, and other business objects, such as MSMEs.

"The goods and services that are still being given VAT exemptions are 0 percent tariff, including basic needs," said the member of Commission XI of the DPR RI.

In addition, he appreciated the government for preparing various protections and incentives for the community in implementing this 1 percent VAT increase policy.

He encouraged the government to carry out its commitment to providing stimulus packages worth IDR 38.6 trillion as previously announced.

"It is appropriate and pro-people, because the government has prepared protection or incentives for the lower, middle and MSME economies according to the proposal of the DPR RI Democratic Party Faction. Please ensure this is right on target," he said.