Corresponding, VAT On Electric Cars Now Only 1 Percent

Illustration (Photo: Doc. Antara)

JAKARTA - The government through the Minister of Finance (Menkeu) Sri Mulyani made the decision to set a Value Added Tax (VAT) of 1 percent for electric cars.

According to the Minister of Finance, the policy is the result of an incentive of 10 percent of the VAT rate which should be imposed at 11 percent.

This step is expected to encourage the use of battery-based electric motorized vehicles (KBLBB), in a press conference in Jakarta, quoted by the editors on Tuesday, March 21.

The Minister of Finance explained that in addition to products sold to the public, the government also provides fiscal facilities to business actors or producers through the tax holiday program for up to 20 years according to the investment value invested in Indonesia.

"Including the industry of motorized vehicles, metals, steel, and smelters to battery manufacturers," he said.

The state treasurer added that there are also tax facilities in the form of a 0 percent tariff for the domestic Luxury Goods Sales Tax (PPnBM), the elimination of the fee for entering the most approved nation (MFN) to a rate of 0 percent of complete imported vehicles, aka completely knocked down (CKD).

"In general, the value of incentives provided can reach 32 percent of the selling value of electric cars," he said.