Tuesday, 02 September, 2008 | 17:43 WIB
TEMPO Interactive, Jakarta:
The House of Representatives passed the income tax bill on Tuesday simplifying the tax structure for corporation and institutions and reducing tax level to 28 per cent.
The new law does not cover individual income tax.
Lawmaker from the Prosperous Justice Party Andi Rahmat said the new law in a shorter term could decrease state revenue from tax, but it would increase the state revenue in a longer term as the number of taxpayers increases.
Airlangga Hartarto from Golkar party added, simplification on income tax could serve as insentive for investments.
Minister of Finance Sri Mulyani said the tax cut was taken by the government after observing the same policy in several neighboring countries. The tax cut she added could also stimulate taxpayers to comply with the regulation.