Indonesia's COVID-19 Vaccination and Economic Resilience Strategy
Fiscal Incentives Policy to Boost the Economy
The government facilitates fiscal incentives to create a conducive investment climate, especially for industry players. Through increased
investment, it is hoped that it can strengthen the domestic industrial structure
TAX HOLIDAY
TAX ALLOWANCE
INVESTMENT
ALLOWANCE
SUPER DEDUCTION
TAX
The criteria are new investment,
taxpayers including pioneer
industries, and income received
from the main business activities
carried out.
There are 18 eligible pioneer
industries that consist of 169
KBLI. Pioneer industries are
defined as industries possessing
broad linkages, giving added
value and high externality,
introducing new technology, as
well as possessing strategic value
for the national economy.
As of September 2022 (year to date):
Total Investment: Rp116 Trillion
Location: 7 provinces
To increase direct investment
activities for certain business
fields and/or in certain areas.
• The facilities include a
reduction in net income of 30%
of the total investment for six
years,
accelerated
depreciation and amortization,
imposition of income tax on
dividends paid to foreign tax
subjects of 10% or lower and
compensation for losses of up
to 10 years.
.
The criteria are having a high
investment value or for export,
a large absorption of labor; or
I have a high local content.
.
Tax Payer: 16 Tax Payer
•
Origin of investment: domestic and 5 countries
•
Total Investment: Rp13.4 Trillion
•
Tax Payer: 13 Tax Payer
•
Approval: 16 Minister of Finance Decree
Source: Coordinating Ministry for Economic Affairs
Source: OSS September 2022
•
• To encourage investment
in
labor-intensive
support
industries,
programs for job creation
and absorption of
Indonesian workers.
• Incentives in the form of
facilities to reduce net
income by up to 60% for
labor-intensive sectors
• There are 45 labor-
intensive industrial sectors
and employ an average of
300 workers in 1 tax year.
Total Investment: Rp363 Billion
Investment: 2 activities
Tax payer: 2 tax payers
Source: OSS September 2022
Super Deduction Vocational
•
Engaging industry in vocational activities
to provide knowledge and encourage the
transfer of knowledge
• A maximum reduction of 200% gross
income from costs in the context of
providing work practice, apprenticeship,
and/or learning activities.
•
As per September 2022, there are 186
agreement for vocational activities (ytd)
R & D Super Deduction
.
Increase the role of industry in fostering
innovation and the use of the latest
technology in the production process
Maximum gross income deduction of
300% over R&D costs carried out in
Indonesia
• As per September 2022, there are 13
proposal for research and development
activities (ytd), with estimated RnD cost
up to Rp97.5 billions
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