Page 4 - Newsletter (Fiscal Incentives for Electric Vehicles and Fiscal Policy Plan for the Year of 2020)

DDTC Newsletter Vol.02 | No.03 I August 2019 Page 4 of 6

Fiscal Incentives for Electric Vehicles and Fiscal Policy Plan for
the Year of 2020

of Anti-dumping import duty on the Import of Spin Table 3 Basic Assumptions of Macroeconomics
Drawn Yarn Products (SDY) from China (MoF Reg No.
115/2019). This regulation will be valid on 20 August Indicator Outlook State Budget
2019. 2019 Draft (RAPBN) of
2020
Based on this regulation, the SDY yarn criteria which will
be imposed the anti-dumping import duty are synthetic Economic Growth (%) 5.2 5.3
filament yarns (other than sewing thread), not prepared
Inflation (% yoy) 3.1 3.1
for retail sale, and include synthetic monofilaments of less
than 67 decitex. On the other hand, high tenacity yarns Exchange Rate (IDR/USD) 14,250 14,400
of nylon or other polyamides or polyester, texture yarns,
other yarns, without twist or with twist not exceeding 50 Government Treasury 5.6 5.4
Bill Interest Rate (Surat
turns per meter, elastomer, partially oriented polyester
Perbendaharaan Negara/
included in HS Code 5402.47.00 will not be subject to the SPN) (%)
rates stated in this regulation.
Oil Price (US$/barrel) 63 65
There are seven Chinese companies mentioned in
the regulation, namely Jiangsu Zhonglu Technology Oil Lifting (thousand 754 734
barrels/day)
Development Co. Ltd., Jiangsu Guowang High-Technique
Gas Lifting (thousand 1,072 1,191
Fiber Co. Ltd., Suzhou Shenghong Fiber Co. Ltd., Zhejiang
barrels/day)
Hengyi High-Tech Materials Co. Ltd., Zhejiang Hengyi
Polymer Co. Ltd., Zhejiang Hengyi Petrochemicals Co.
Ltd., and Zhejiang Sheng Yuan Chemical Fiber Co. Ltd. Fourth, considering the business improvement regarding
Those companies are subject to tariffs ranging from 5.4% the tax aspect, especially in the case of VAT refunds.
to 9.4%. Furthermore, for other companies which are not Fifth, improving the data management from Automatic
listed, the anti-dumping import duty rate charged is 15%. Exchange of Information (AEoI). Sixth, conducting the
Fiscal Policy Plan for the Year of 2020 extensification of excisable goods. Seventh, adjust the
tariff of excise for tobacco products. Furthermore, in
order to support the competitiveness and investment,
President of Indonesia, Joko Widodo delivered the
the government also provides tax incentives.
Speech concerning the Budget Statement of 2020 State
Budget before the House of Representatives of the On the other hand, the government also needs to be
Republic of Indonesia Meeting on 16 August 2019. The aware of the shortfall risk due to the weakening of tax
theme of fiscal policy for next year designed by the buoyancy considering the high expectation of this year
government is “State Budget (APBN) for Accelerating the outlook. As information itself, the nominal growth for tax
Competitiveness through Innovation and Strengthening revenue and Gross Domestic Product (GDP) were 3.74%
Human Resources Quality.” There are three main points and 5.05% respectively until the second quarter of 2019.
of fiscal policy strategies, namely revenue mobilization,
effective state spending, and creative financing. Tightened Regulation of Fiscal
Facilities for Coal Importer
In the aspect of state revenue, the government offered
a tax revenue target of IDR1,639.9 trillion. The target
The Government of Indonesia issued a new provision
increases around 14.08% compared to this year’s revenue
related to the granting of fiscal facilities for imports
outlook of IDR1,437.5 trillion. Furthermore, taxation
conducted by coal mining companies in the middle of
revenue which includes customs and excise is targeted to
August 2019. The two types of fiscal facilities mentioned
IDR1,861.8 trillion with the growth of 13.3% compared
here are the exemption or relief of import duties and
to 2019 State Budget outlook. The value of taxation
the exemption of VAT on the import of taxable goods
revenue itself reaches 83.8% of total state revenue for in the framework of a Contract of Work/CoW (Kontrak
next year. The basic assumptions of macroeconomics to Karya/KK) or Coal Contract of Work/CCoW (Perjanjian
set these targets are listed in the Table 3. Kerjasama/Karya Pengusahaan Pertambangan
The government then set seven main tax policies to Batubara/PKP2B). This is regulated in the MoF
anticipate these target growths. First, increasing taxpayer Regulation Number 116/PMK.04/2019 (MoF Reg No.
compliance. Second, improving the quality of services, 116/2019) which amended the MoF Regulation Number
dissemination, and supervision through strengthening 259/PMK.04/2016 (MoF Reg No. 259/2016).
IT and tax administration systems. Third, equalizing the
The issue of this provision is objected to improve
level of playing field to optimize tax revenue from digital
taxation and customs services in the field of mineral and
economy.