Excise duty to be imposed on several products<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
In a bid to boost excise revenue, the Directorate General of
\nExcise and Customs will impose excise duty on a number of new
\nproducts starting Jan. 1 next year, provided that the House of
\nRepresentatives give its approval.<\/p>\n
The excise duty -- to be slapped on cassettes, laser discs,
\ncompact discs, video compact discs and digital versatile discs
\n(DVDs) -- will have the potential to jack up state revenue by up
\nto Rp 170 billion (US$18.08 million), said Minister of Finance
\nBoediono, who oversees the excise and customs office, on Friday.<\/p>\n
Boediono added the ministry had met with relevant parties,
\nincluding business players, and discussed the issue. \"We have
\napproached them, and it seems that they do not object to the
\nplan,\" he said, without elaborating.<\/p>\n
At present, excise duty is imposed on cigarettes, alcohol and
\nliquor, with this year's combined revenue targets at Rp 27.7
\ntrillion, or 1.4 percent of gross domestic product (GDP) --
\naround 90 percent of which come from cigarettes.<\/p>\n
But for next year, the House Budget Commission has raised the
\nexcise revenue target to Rp 28.62 trillion.<\/p>\n
Apart from increasing revenue, Director General of Excise and
\nCustoms Eddy Abdurrachman said that the plan was also aimed at
\nsetting up a clear mechanism to control smuggling and piracy in
\nthe products.<\/p>\n
\"Based on a survey carried out by the ministry, pirated
\nproducts make up about 90 percent of the total output in these
\nproducts.<\/p>\n
\"By slapping duty on them, it will create a simpler
\nsupervisory mechanism, because it's hard to differentiate between
\noriginal products and pirated ones just by looking at them,\" Eddy
\nsaid.<\/p>\n
The government has been trying hard to seek other financial
\nsources to finance the annual state budget, severely crippled
\nthrough servicing domestic and foreign debt payments -- both
\nmaturing principal and interest.<\/p>\n
It remains to be seen, however, whether the move will be able
\nto reduce rampant piracy and smuggling, and what impact it will
\nhave on the industry.<\/p>\n
Slapping on the duty will increase production costs and push
\nup the price of the products.<\/p>\n
Not only will this discourage customers and hurt producers in
\nthe end, but will also create a huge price disparity between
\noriginal and pirated\/smuggled products -- which could then be
\ncounterproductive to the government's bid to curb the illegal
\nactivities in the first place.<\/p>\n
Elsewhere, if put into action, Eddy said the state coffers
\ncould be richer by Rp 98.4 billion to Rp 170 billion on the
\nassumption that each product carried an excise duty of Rp 750.<\/p>\n
As for this year, the office has collected Rp 12.77 trillion,
\nwhich accounts for 47 percent of the full-year target.<\/p>\n
The figure was higher than that collected in the same period
\nlast year, which stood at Rp 10.87 trillion.<\/p>\n
\"The second semester will be better, because the revenue is
\ngreater from mid-year to the year-end,\" Eddy said.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/excise-duty-to-be-imposed-on-several-products-1447893297",
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"sponsor": "Okusi Associates",
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