Problems relating to Trade and Investment on Indonesia
6. Reduction and elimination of preferential policies for foreign capital |
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Issue |
Issue details |
Requests |
Reference |
| (1) Nebulous Nature of the Import Duty Exemption Scheme as Preferential Measures for Investment | - Implementation basis is absent and nebulous regarding the scheme of "The Exemption of Import Duty on Imported Machines, as well as Goods and Materials for The Building or Development of Industries in The Framework of Investment". It disables reflection of the expected profit from the import duty exemption (12.5%) in the pricing of the relevant products to the purchaser entitled to import duty exemption. | - It is requested that GOI secures transparency in processing the new application for the import duty exemption to purchasers of member firm's subsidiary (MFS) that serves as domestic supplier, by ascertaining its supply policy in regard to the applicable quantity for the eligible products in the allocated quantity, which can be monitored without fail. | - 176/PK011/2009-Financial Ministry(BKPM) - 19/M-IND/PER/2/2010-Industrial Ministry - 69/M-IND/PER/7/2011-Industrial Ministry |
| (Action) - Since 16 August 2015, ministry of finance deregulated the tax holiday scheme, expanding the scope of eligible "pioneer industry" to include manufacture of industrial machinery & equipment, infrastructure project under PPP, etc. in total of 9-industrial sectors, with extended the period of the tax holiday. |
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