VAT For Luxury Goods, MPR Leader: President Doesn't Leave The People

Deputy Chairperson of the Indonesian People's Consultative Assembly Eddy Soeparno IAntara)

JAKARTA - Deputy Chairperson of the Indonesian People's Consultative Assembly, Eddy Soeparno, said that President of the Republic of Indonesia Prabowo Subianto's move to implement a 12 percent value added tax (VAT) policy was only for the category of luxury goods, affirming consistency in his economic policies that did not leave the people.

"Once again, President Prabowo proves his consistency that 'no one is left behind'. For Pak Prabowo in building the economy, welfare is the right for all and nothing should be left behind," said Eddy in a statement received in Jakarta, Wednesday.

He considered that the policy proved that President Prabowo listened to the aspirations of the people conveyed through various aspiration channels, from social media to petitions.

"President Prabowo opened the widest possible space for democracy, conveying aspirations was given a place and there was absolutely no repression. President Prabowo heard the aspirations of the people and was immediately proven by policies that were pro-small people," he said.

He also ensured that the MPR RI would continue to support the pro-people programs of President Prabowo to realize an independent, united, sovereign, just and prosperous Indonesia in accordance with the mandate of the constitution for the opening of the 1945 Constitution of the Republic of Indonesia.

"The MPR support for the policy of eliminating debt for MSMEs, President Prabowo's commitment to stop rice imports next year and increase the price of unhulled rice, VAT is only for luxury goods to social assistance stimulus packages of IDR 38 trillion," he said.

The government has officially set an increase in value added tax (VAT) from 11 percent to 12 percent in 2025 only applies to luxury goods and services.

The goods and services charged with the 12 percent VAT rate are goods and services listed in the Minister of Finance Regulation (PMK) Number 15 of 2023 concerning the Imposition of Sales Tax on Luxury Goods (PPnBM).

"Well, that category is very small, limited, namely goods such as private jets, cruise ships, and also very luxurious houses whose value has been regulated in the PMK regarding VAT for luxury goods number 15 of 2023," said Finance Minister Sri Mulyani Indrawati at a press conference in Jakarta, Tuesday (31/12/2024).