Experts laud planned tax incentives<\/p>\n
JAKARTA (JP): Investment and trade consultants hailed the
\ngovernment's plan on Saturday to provide new tax incentives in
\norder to boost the inflow of foreign direct investment into the
\ncountry.<\/p>\n
But they said that providing tax incentives would not work in
\nattracting foreign investors if the government failed to create
\npolitical stability in the country.<\/p>\n
\"The bottom line is, the government can not solely depend on a
\ntax incentive scheme to attract investors. It should also create
\na conducive climate for investment,\" said Johan Bukit, a director
\nof IndoTrade trade and investment consulting company.<\/p>\n
Bukit said the most important thing for the government was how
\nto create political stability, impose a proper fiscal policy and
\neliminate all red tape.<\/p>\n
State Minister of Investment\/chairman of investment planning
\nboard (BKPM) Marzuki Usman said on Friday he would propose an
\namendment to the existing tax law to pave the way for the
\nissuance of a tax holiday to investors.<\/p>\n
Marzuki said without the tax holiday, Indonesia would no
\nlonger be attractive to foreign investors.<\/p>\n
Besides preparing the tax holiday, the government would also
\nempower provincial investment offices (BKPMD) to issue investment
\npermits in an attempt to lure investors.<\/p>\n
As part of the incentives to draw wary foreign investors, the
\ngovernment is also considering allowing foreigners with a total
\ninvestment of at least US$1 million to obtain permanent resident
\nstatus, which would free them from visas to enter the country.<\/p>\n
According to BKPM, foreign direct investment approved by the
\ngovernment in the first half of this year dropped 77.5 percent to
\n$1.88 billion from $8.35 billion in the corresponding period last
\nyear.<\/p>\n
However, the number of approved foreign investment in the same
\nperiod rose 7.5 percent to 518 projects from 482 projects.<\/p>\n
\"This phenomenon proves that investment in the country is not
\ndead, it's just changing its form,\" Bukit said, adding that he
\nrecognized a shift in investors' interests from large-scale
\nprojects in previous years to medium-scale projects.<\/p>\n
Bukit said many investors still complained that the
\nregulations were not fully implemented, there was a lack of
\nconsistency and it was confusing despite the government's strong
\ncommitment in boosting foreign investment. (01)<\/p>",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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