Govt wants to annul 'nuisance taxes'<\/p>\n
The Jakarta Post, Jakarta<\/p>\n
The Ministry of Finance will propose to the Ministry of Home
\nAffairs to annul a host of provincial regulations and city bylaws
\nthat hamper businesses in regions.<\/p>\n
\"We (the finance ministry) are studying a lot of provincial
\nregulations that are not necessary and just hinder business
\nactivities. We will propose to the Ministry of Home Affairs to
\nannul them,\" Tjep Ismail, director of provincial revenue at the
\ndirectorate general of fiscal balance at the Ministry of Finance,
\nsaid on Tuesday.<\/p>\n
He said that his office had so far identified a total of 206
\nprovincial regulations and city bylaws that must be scrapped.<\/p>\n
In 2001, the Ministry of Finance proposed to the Ministry of
\nHome Affairs to annul 80 regulations, in 2002 there were 92 more,
\nand as of June of this year 34 regulations, he explained. It is
\nnot clear, however, why the Ministry of Home Affairs had not
\nannulled these regulations.<\/p>\n
Since the regional autonomy law became effective in 2001, many
\nlocal administrations began issuing a variety of sometimes very
\nbizarre regulations mainly aimed at expanding their revenue
\nsources. But many of the rulings, however, have become a
\nfinancial and bureaucratic headache for investors.<\/p>\n
A World Bank report last month particularly addressed the
\nmatter saying the issuance of a host of \"nuisance taxes\" by
\nregional governments had negatively affected the business and
\ninvestment climate in the regions.<\/p>\n
Examples of such taxes are those for importing goats into
\nBogor, West Java from other provinces or for Coca-Cola bottles in
\nLampung province.<\/p>\n
Some regulations also are seen as overtly discriminative
\ntoward prospective investors from other provinces or countries.<\/p>\n
The World Bank said that one of the ways to help resolve the
\nproblem was to give more power to regions over land and building
\ntaxes as compensation for eliminating the nuisance taxes.<\/p>\n
\"All around the world, land and building taxes are done at the
\nlocal level. We feel that having regions decide on the rate for
\nthis tax would be a key to better governance,\" the Bank said in
\nits latest assessment report on the country's fiscal
\ndecentralization program.<\/p>\n
Reportedly, the Ministry of Industry and Trade is also
\ndrafting a bill on trade that will revise some provincial
\nregulations that increase the cost of distributing goods to other
\nregions.<\/p>\n
Such regulations had been cited by economists as the main
\nreason for soaring prices of goods in the country, which in turn
\nmakes them less competitive against imported products.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/govt-wants-to-annul-nuisance-taxes-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}