Jokowi Issues Presidential Decree On Electric Vehicle Import Incentives

ILLUSTRATION/ANTARA/HO-Humas PLN

JAKARTA - President Joko Widodo issued a Presidential Regulation (Perpres) regulating the provision of incentives for importing battery-based electric motorized vehicles (KBL) in a complete state (completely build-up/CBU).

This provision is regulated in Presidential Regulation Number 79 of 2023 concerning Amendments to Presidential Decree Number 55 concerning the Acceleration of the Battery-Based Electric Motor Vehicle Program for Road Transportation, which was set by President Joko Widodo on December 8, 2023.

In Article 19A paragraph (1) of the Presidential Regulation, it is stated that the incentives provided can be in the form of import duties on battery-based KBL imports in a complete state (completely build-up/CBU) or incentives for imports of battery-based KBL in a complete state.

In addition, the government also provides sales tax incentives on luxury goods for battery-based KBL in a complete state or incentives for the sale tax on luxury goods borne by the government for battery-based KBL in a complete state, and/or incentives for exemption or reduction of regional taxes for battery-based KBL are intact.

The Presidential Regulation was issued to accelerate the improvement of the battery-based electric motor vehicle ecosystem. The government assesses the need to increase the scope of battery-based electric motorized vehicles, adjust the use of domestic component levels and strengthen support by the Central and Regional Governments.

The regulation also regulates a number of regulations, including fiscal incentives as well as conversion assistance and assistance for electric motorized vehicles based on two-wheeled batteries by the government for a certain period of time, as stated in Article 19 paragraph (2).

The government also stipulates the use of the Domestic Component Level (TKDN) for two-wheeled and/or three-wheeled KBL between 2019-2026 and a minimum of 40 percent, 2027-2029 a minimum of 60 percent, and 2030 and so on a minimum of 80 percent.

As for four-wheeled KBL, the use of TKDN is regulated, namely 2019-2021 a minimum of 35 percent, 2022-2026 a minimum of 40 percent, 2027-2029 a minimum of 60 percent, and 2030 and so on a minimum of 80 percent.

The provisions for the obligation to prioritize the use of TKDN as intended do not apply to conversion-based battery-based KBLs carried out by conversion workshops.

The Presidential Decree was enacted in Jakarta on December 8, 2023 by President Joko Widodo and promulgated on the same date by Minister of State Secretary Pratikno.

The public can download a copy of Presidential Decree Number 79 of 2023 through the jdih.setneg.go.id page.