Government scraps VATs to help shipping industry<\/p>\n
JOHOR BAHRU, Malaysia (JP): The government took steps to help
\nthe country's ailing shipping industry by lifting all value added
\ntaxes (VATs) on the purchase and lease of ships, docking and port
\nservices.<\/p>\n
The director general for sea transportation at the Ministry of
\nCommunications, Agus Rudyanto Ruwadi, said here on Saturday that
\nPresident B.J. Habibie issued a decree on Thursday eliminating
\nthese 10 percent VATs.<\/p>\n
\"The measure is part of the government's commitment to develop
\nthe country's shipping industry and prepare it for global
\ncompetition,\" Agus said on the sidelines of the ceremony marking
\nthe delivery of crude oil and gas tankers from Malaysia Shipyard
\n& Engineering Sdn Bhd to PT Bumi International Tankers and PT
\nLayar Sentosa Shipping Corporation in Pasir Gudang, Johor Bahru,
\nMalaysia.<\/p>\n
Local shipping companies have long complained about the high
\ntaxes imposed on them by the government, blaming these taxes for
\nhelping to cripple the development of the country's shipping
\nindustry.<\/p>\n
Secretary General of the Indonesian National Shipowners
\nAssociation Barens Saragih, also present at the ceremony, said
\nthe association warmly welcomed the government's move.<\/p>\n
\"We really thank the government for realizing the importance
\nof increasing the competitiveness of the national shipping
\nindustry,\" Barens said, adding countries such as Malaysia and
\nSingapore had long since removed value added taxes on their
\nshipping companies to help make them competitive.<\/p>\n
Barens, however, called on the government to further
\nderegulate the country's shipping industry by scrapping the
\nremaining 1.2 percent corporate taxes as had been done by
\nSingapore and Malaysia.<\/p>\n
\"The shipping industry is part of the infrastructure. The
\ntaxes imposed on it will multiply the prices of the commodities
\nit carries,\" Barens said.<\/p>\n
He said that in the past the association had repeatedly called
\non the government to take measures to strengthen the country's
\nshipping companies, arguing that the country could save more of
\nits foreign exchange earnings if national shipping companies
\ncarried a larger portion of the country's exports.<\/p>\n
However, the government under former president Soeharto paid
\nlittle attention to the shipping industry, focusing instead on
\nexport-oriented companies.<\/p>\n
Today, Barens said, national shipping companies transport only
\n3 percent of the country's exports, leaving the remaining 97
\npercent to be carried by foreign shipping companies.<\/p>\n
Because of this, the country must spend billions of dollars
\nper year for the transportation of its goods.<\/p>\n
Barens, however, said he was optimistic that national shipping
\ncompanies would be able to increase the percentage of the
\ncountry's exports that they transport, \"provided that the
\ngovernment is consistent with its deregulation policies\". (jsk)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/government-scraps-vats-to-help-shipping-industry-1447893297",
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