The US Lobbying Government For Resipprocal Tariffs For Indonesian Furniture Products To Be Removed

Minister of Trade Budi Santoso (Photo: VOI)

JAKARTA - The Ministry of Trade revealed that the government is negotiating with the Government of the United States (US) so that the reciprocal tariff for furniture products can be removed.

Trade Minister Budi Santoso said that currently all Indonesian furniture products that enter the US have been subject to a sectoral tariff of 3 percent. If the reciprocal rate of 32 percent applies, then Indonesian furniture products will be subject to an entry rate of 35 percent.

Furthermore, Budi said that with the temporary delay in the resipulation rate for 90 days, the current entry rate for Indonesia is 10 percent.

"That's why we ask for the resiprocal to be lost. If it goes away, it means it's still 3 percent, now 90 days are only subject to a baseline of 10 percent, so 10 percent is added by 3 percent," he said at the Ministry of Trade, Jakarta, Wednesday, May 21.

Budi revealed that Indonesia's export of furniture products to the US reached 1.64 billion US dollars or equivalent to Rp. 26.89 trillion (assuming an exchange rate of Rp. 16,398 per US dollar), with the market share reaching 5.57 percent at this time.

In 2024, continued Budi, Indonesia is the largest furniture exporter in the world, its total value reaches 2.43 billion US. Therefore, he said the government was studying the problem so that Indonesia's furniture exports could rise.

Budi also said that the government is working on deregulations related to exports and imports to provide ease of doing business. This deregulation can later encourage exports including furniture and handicraft products to occupy the top 10 in the world.

"So if possible, the top 10 is not 20. Now we are trying to learn what the problem is. We are still making deregulations, not only imports, we also carry out export deregulations, including deregulation of ease of doing business in the trade sector," he explained.

Budi admitted that he had held discussions with associations and also the Ministry of Forestry so that wood derivative products such as furniture and crafts did not require V-Legal documents or wood product export licenses.

According to Budi, the V-Legal document should only be used for countries in need. Like Britain and the European Union.

For your information, V-Legal is a document used as a condition for submitting export notifications for goods for exporters of wood products in accordance with statutory provisions.

"V-Legal is allowed, but only for countries in need, for example, the UK and the European Union, the UK and the European Union need it now, but to other countries we propose that we shouldn't need V-Legal," he said.

According to Budi, the elimination of V-Legal is needed to make it easier to export. In addition, it also makes it easier for the bureaucracy.

"What is the goal? For us to be easy, yes, our bureaucracy is easier to export. Then the requirements are also easy," he said.