12 Percent VAT Polemic, Gerindra Accuses Dolfie PDIP's Statement As A Provocation

Deputy Chairman of the Budget Agency (Banggar) as well as Member of Commission XI DPR RI, Wihadi Wiyanto (doc Gerindra)

JAKARTA - Deputy Chairman of the Budget Agency (Banggar) as well as Member of Commission XI DPR RI, Wihadi Wiyanto, emphasized that the government cannot immediately reduce Value Added Tax (VAT) which has been regulated in Law Number 7 of 2021 concerning Harmonization of Tax Regulations (UU HPP).

This statement was conveyed by Wihadi in response to the statement by the Deputy Chairman of Commission XI of the DPR RI from the PDIP faction, Dolfie Othniel Frederic Palit, who said the government could propose a reduction in VAT rates.

Wihadi stated that Dolfie, as a PDIP cadre who also proposed the HPP Law, did not understand the provisions stipulated in the law.

"Regarding what was conveyed by Dolfie, as Chair of the Panja, he did not understand this law. It was seen when he read Article 7 Paragraph (3), but did not read it in its entirety until Paragraph (4)," said Wihadi in his statement, Sunday, December 22.

According to the legislator from the Gerindra Party faction, Article 7 Paragraph (4) of the HPP Law states that Government Regulations (PP) to determine the assumption that VAT rates with a range of 5 to 15 percent can only be made based on the approval of the DPR during the discussion of the Draft State Revenue and Expenditure Budget (RAPBN).

"In Paragraph (4), it is explained that the PP that can be made by the government with the approval of the DPR is to determine the assumption of tax revenue in the tariff range of 5 to 15 percent. This is related to the discussion of the RAPBN, it does not mean that the government can directly cut or lower the VAT rate just like that," explained Wihadi.

Furthermore, Wihadi emphasized that the State Budget for the 2025 fiscal year has been agreed upon by the government and the DPR for the 2019-2024 period, so there is no sudden change in VAT rates.

Wihadi views Dolfie's statement as a form of public lies and provocations that have the potential to provoke public unrest.

This Dolfie statement is a public lie. In fact, this is like an effort to provocation so that people think the government is not in their favor. In fact, the HPP Law is a legislative product from PDIP when it became the ruling party," said Wihadi.

He added, 'This is a form of provocation to create conditions that make people demand the cancellation of VAT.'

Previously, Dolfie Onniel Frederic Palit stated that the Prabowo Subianto government could actually propose a reduction in VAT rates.

According to Dolfie, Article 7 Paragraph (3) of the HPP Law provides space for the government to adjust the VAT rate in the range of 5 to 15 percent, with the approval of the DPR.

"As mandated by the HPP Law, the VAT rate from 2025 is 12 percent. The government can propose changes to the tariff in the range of 5 percent to 15 percent, according to Article 7 Paragraph (3) of the HPP Law, with the approval of the DPR," said Dolfie in a written statement some time ago.