Indonesia increase vehicle tax to 10%
Indonesia government increase vehicle tax to 10%
By Ali Budiman
Traffic Jam in Jakarta | Cars, Motorcycle, Trucks and Buses
To reduce traffic jammed that getting worse, the Indonesian government made various efforts such as by increasing vehicle taxes, fuel taxes and parking taxes that aim to reduce the population of passenger cars. At the beginning of last September, the Special Committee on Bills and Taxes Regional formed by the Indonesian government and parliament decided and agreed to raise the vehicle tax, fuel tax and parking tax.
In previous regulation amount of vehicle tax is only up to 5% and does not applied progressive, and actually the vehicle tax only 2% of vehicle sale value. Meanwhile in new regulation that applicable by January 1st, 2010, vehicle tax up to 10% and progressive applied.
It’s mean, for the first own vehicle, vehicle tax has only 2% of the sale price of vehicles, while for second vehicles and so on, that number of vehicle tax will increase to between 2-10% of the sale price depending on provincial government’s decision where the vehicle owner living. Primary progressive tariff setting was determined based on the name or address and the same, the cylinder capacity of auto motors, and age of vehicle.
As an illustration, if the first new car purchased 100 million rupiah, vehicle tax is 2% or Rp 2 million per year. However, if the type of car purchased for the second car onwards, vehicle tax is charged may be more expensive, 5% to 10% is equal Rp 5 to 10 million.
Absolutely this new policy on automobile taxes will affect to Indonesia automobile industry. Will many vehicle owners objected primarily Logistic Company, Rental Car Companies, and companies who has the operation car. The tax increase is like a double-edged knife, there are good sides and bad sides. The good side is that tax revenue will increase, while one of the bad sides is to make consumers harmed. Especially if the transportation facilities still poor as the current fixed vehicle taxes be raised though. Indonesian government should not make tax policy confusing and harmful, but should be used to improve transportation facilities, roads and public transport condition.
Related articles:
- Various taxes of New Car Price
- Cost and Taxes of Vehicle Registration
- Luxury Tax of Car will be increase
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