New fuel tax 'should be applied selectively'<\/p>\n
JAKARTA (JP): The planned introduction of a new 5 percent tax
\non fuel should not be applied to all consumers, councilors said
\nyesterday.<\/p>\n
Councilors were responding to the imposition of a new tax,
\nwhich still waits for approval from the Ministry of Home Affairs
\nafter consultations with the Ministry of Finance.<\/p>\n
On Monday the government announced a deregulation package
\ncutting local taxes from 42 categories to nine, and fees from 192
\ncategories to 30.<\/p>\n
The introduction of the fuel tax is expected to compensate
\nlosses incurred from the reduction of tax and fee categories.<\/p>\n
Hasan Dasy of Commission B for economic affairs and Helmy R.
\nSyihab of Commission C for city revenue, said separately the
\napplication of the new tax should take into account different
\nincome levels.<\/p>\n
\"Many people only use motorcycles,\" Hasan said.<\/p>\n
Helmy said, nevertheless, the new tax could significantly
\nincrease city revenue from the 4 million motorized vehicles
\ncurrently in operation in the city.<\/p>\n
Government regulation No. 21\/1997 states the tax applies to
\nPremium and Premix gasoline brands, meaning public transport,
\nwhich mostly uses diesel fuel, will not be subject to the tax.<\/p>\n
Premium brand gasoline is now Rp 700 per liter, which will be
\nRp 735 with the new tax.<\/p>\n
The regulation does not state a specific reason for the fuel
\ntax. It only states provincial revenues need to be increased to
\nsupport autonomy, and that improvement of taxes and fees should
\nbe focused on efficiency and better public service.<\/p>\n
In a report last year, the World Bank suggested raising fuel
\nprices to help cover pollution costs.<\/p>\n
Helmy said, \"Although we have lost eight tax categories, city
\nrevenue will be compensated by the new tax.\"<\/p>\n
So far city revenue has come from 13 different taxes and 44
\ndifferent fees this year. In 1996\/1997, the fees and taxes
\nbrought in Rp 1.7 trillion of Rp 2.8 trillion in revenue.<\/p>\n
Eliminated taxes include a foreigner tax, dog tax, radio tax,
\nnonmotorized land and water vehicle tax, tax on transfer of
\nownership of nonmotorized vehicles, slaughterhouse tax and an
\nalcohol tax.<\/p>\n
Helmy declined to comment on the alcohol tax which recently
\nraised an uproar. Moslem groups charged that city efforts to curb
\nalcohol consumption through an increase of distributor licensing
\nfees was equal to legitimizing consumption.<\/p>\n
\"In the last fiscal year these (former) taxes amounted to
\naround Rp 6 billion,\" Helmy said. The cost in collecting them was
\nlarger than the revenue they brought in, he added.<\/p>\n
Apart from the fuel tax, the government's new regulation on
\nlocal taxes comprises of an annual 1.5 percent tax on motorized
\nvehicles; 10 percent tax on the first transfer of vehicle
\nownership; 10 percent tax on hotels and restaurants; 35 percent
\nentertainment tax; 25 percent tax on billboards; a maximum 20
\npercent tax on street lights; 20 percent tax on 34 types of \"C\"
\ncategory mineral exploitation, such as granite and sand, and a
\nmaximum 20 percent tax on ground water use.<\/p>\n
Vendors<\/p>\n
The new list of fees in government regulation No. 20\/1997
\nstill lists fees on markets, wholesale markets and stores, but
\ndoes not include a fee on sidewalk vendors.<\/p>\n
Councilor Hasan said the government has yet to explain the fee
\nelimination, but said \"the government should have good
\ncoordination with local governments and understand\" if sidewalk
\nvendor fees are eliminated.<\/p>\n
So far, Hasan said, vendors have managed to bring in an annual
\nRp 1.8 billion while city-owned market company PD Pasar Jaya,
\nthrough 160 markets, raised Rp 1.6 billion in city revenue.<\/p>\n
Helmy said as long as vendors used kiosks provided by the
\ngovernment, they would still need to pay fees and sanitation
\nlevies for services.<\/p>\n
Both Hasan and Helmy said the new regulation would mean
\nillegal levies \"would have to stop\". Rather than ending fees paid
\nby registered vendors, Hasan said it would be better if the city
\n\"wiped out all fees paid by vendors to various parties, including
\nthe mayoralty, organizations and other offices, by replacing the
\ninstitutions with one agency to draw fees from them.\" (anr)<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/new-fuel-tax-should-be-applied-selectively-1447893297",
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