2022 State Budget: Fiscal Policy and Structural Reform
Efforts to Accelerate Infrastructure Provision
Land Value Capture (LVC) Scheme
"
A policy approach that enables communities to recover and reinvest
economic value increases and increases in economic productivity that
result from public investment and other government actions. (Lincoln
Institute of Land Policy)
Tax Based LVC
Land and Property Tax
Betterment Levies and
Special Assessment
Development Based LVC
Land Sale and Rent
Collaboration in the development of LVC
Regulation in Indonesia
The implementation of LVC obviously
need an intensive cooperation of all
related stakeholders, such as: National
and Regional Government, SOE & ROE,
International Institution, as well as
higher education agencies with CMEA as
an implementing coordinator.
Air Right Sale
Tax Increment Financing
(TIF)
Joint Development
Land Readjustment
2019
Triple Win LVC
Creating Fiscal
Space
Better Urban
Reducing Subsidy
Mobility
LVC Benefit
Local revenue from tax and levy
Better city planning and development
Regional growth
Distributed development in urban area
Source: Committee for Acceleration of Priority Infrastructure Delivery (KPPIP)
1
National
and
Regional
Govt
SOE &
ROE
Universit
and other
higher
education
agencies
LVC Policy Development Timeline
•
Finalizing Study on National Value
Internatio
nal
Institution
Capture Framework in Indonesia
2020
Initiate the LVC policy implementation in the form of legal
regulation and pilot projects
Conducting socialization and stakeholder capacity
development on LVC
2021
.
Completing the pilot project modelling process to
find the most appropriate LVC scheme to be
implemented in Indonesia
Completing legal drafting as the regulation on
national LVC policy
2022
LVC development and implementation
Conducting socialization to Regional
Government and SOE
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