Tax Exemption For MSMEs Affected By COVID-19 For 6 Months

Minister of Cooperatives and SMEs Teten Masduki (Irfan Meidianto / VOI)

JAKARTA - The government provides relief for Micro, Small and Medium Enterprises (MSMEs) actors who are affected by the corona virus pandemic or COVID-19 by providing tax exemptions for the next 6 months. With the elimination of these taxes, it is hoped that an economic stimulus will occur and help MSME players to develop their businesses.

"The decision to abolish the tax for 6 months for MSMEs has been taken," explained Minister of Cooperatives and SMEs Teten Masduki in a live broadcast of the press conference on BNPB's official YouTube account, Wednesday, April 15.

In addition to tax elimination, for the surviving MSMEs, the government will implement other assistance schemes such as credit relaxation for affected business actors for the next six months.

This relief, said Teten, is not only given to recipients of People's Business Credit (KUR) or loan recipients through PIP which are channeled from PNM with the Mekar, Ulam, and UMI, Pegadaian, and LPDB programs. Instead, it will also be given to loan recipients under Rp. 10 million through Rural Banks (BPR), BPRS through savings cooperatives, cooperatives, and BMT and other credit agencies.

This stimulus policy, according to Teten, was taken because the government understands that 99 percent of business actors in Indonesia are engaged in the MSME sector, the majority of which are micro business actors.

Back to the matter of assistance, businesses that are no longer able to operate due to limited capital, Teten said, will be included in the list of recipients of social assistance. Meanwhile, those that are still running will be given new credit loans.

"Another program for economic stimulus is that we have a program to provide a stimulus for the purchasing power of MSME products. This is so that demand exists," he said.

"Then the last one is the integration program of implementing social assistance for cheap basic food cards with the involvement of traditional stalls," he added.

Teten also conveyed that many UMKM entrepreneurs have swerved into the business of making personal protective equipment (PPE) or masks. This is thought to occur because of the large number of markets for these products after the spread of the corona virus in Indonesia.

"Now, several convections, several small and medium enterprises have swerved to produce PPE," he said.

So, to help the movement of small and medium business actors who are now producing PPE, Teten hopes that these business actors can be glimpsed by the central and regional governments, BUMN, and the private sector.

"We hope that later on in government and state-owned enterprises, including donation programs in the community, we have offered a lot of these UMKM products," he said.

Previously, when chairing a limited meeting via video conference, President Jokowi asked his staff to accelerate the implementation of the relaxation and credit restructuring program for MSME business actors affected by COVID-19.

Jokowi asked for this application to be carried out quickly and not to let business actors go out of business before receiving assistance from the government.

"Don't wait until they close before we move. Don't be late and cause turmoil in the community," said Jokowi at the closed meeting.

The former governor of DKI Jakarta also asked the minister and his staff to calculate the available budget. So, the credit relaxation program can be further decided later.

In addition, Jokowi also asked the relevant ministers to create a new financing scheme related to investment and labor. The scheme is expected to make it easier for the affected local governments to reach the assistance.

Finally, he also requested that MSMEs continue to be given opportunities so that they can continue to produce while continuing to prioritize health protocols. Especially for MSMEs engaged in agriculture, home industry, traditional stalls, and the food and beverage sector.