Jokowi Signs Presidential Regulation On Acceleration Of IKN Development And Regulates Incentives For Candidates For Investors

Building Building Project and Area of Coordinating Ministry 3 at IKN. ANTARA/HO-PT Waskita Beton Precast/am.

JAKARTA - President Joko Widodo signed Presidential Regulation (Perpres) Number 75 of 2024 concerning the Acceleration of Development of the Capital City of the Archipelago (IKN), which generally regulates the provision of incentives for potential investors who participate in building services and facilities at IKN. The copy file of the Presidential Decree on the Legal Documentation and Information Network (JDIH) page of the Ministry of State Secretariat in Jakarta, as quoted from Antara, Friday, July 12, stated that the government provides incentives and business licensing facilities to business actors who carry out the construction of the provision and management of basic/or social services as well as commercial facilities. In the regulation officially promulgated on July 11, 2024, the government provides incentives and business licensing facilities through the Archipelago Capital Authority (OIKN), ministries/agencies, and local governments in accordance with the provisions of the legislation. In Article 5 paragraph 1 of the Presidential Regulation, the Head of OIKN, in this case the Minister of PUPR Basuki Hadimuljono who was appointed as Plt. The Head of OIKN, can establish a pioneer business actor with the criteria that he has expressed interest and signed a "peter of intent" with the OIKN. The pioneer business actor who participated in the development at IKN with a source of costs outside the state budget was also willing to start the implementation of development at IKN for a maximum of five years from the enactment of Law Number 21 of 2023 concerning the State Capital. Then in article 7, pioneer business actors can be subject to tariffs on asset management in control (ADP) by OIKN up to Rp0 or with installment payments. Incentives for business actors are also provided in the form of guaranteeing the certainty of the term of right to land mentioned in Article 9. In Article 9 paragraph 2, the right of use is given up to 190 years which is given through two cycles or for 95 years in one first cycle and 95 years in the second cycle. "Business rights for a maximum period of 95 (ninety five) years through 1 (one) first cycle and can be given back for 1 (one) second cycle with a maximum period of 95 (ninety five) years based on the criteria and stages of evaluation," reads Article 9 paragraph 2 in the Presidential Decree. Meanwhile, the government also guarantees building use rights with a maximum period of 80 years in the first cycle and can be given back in the second cycle with a maximum period of 80 years, bringing the total to 160 years for HGB. Building rights are also granted with a maximum period of 80 years in the first cycle and the next 80 years in the second cycle. The three rights to land are of course given based on the criteria and stages of evaluation. The government also regulates the Tax Object Selling Value (NJOP) which will be determined by OIKN when holding a special regional government.

The implementation of the acceleration of IKN development aims to form an ecosystem for livable cities, especially in the Central Government Core Area.