Progressive car tax is a double-edged sword<\/p>\n
JAKARTA (JP): Governor Surjadi Soedirdja announced over the
\nweekend that the city administration has implemented the
\nprogressive car taxation system as of April 1.<\/p>\n
The governor told members of the City Council during a plenary
\nmeeting that the tax system is an effort to increase Jakarta's
\nregional revenue from the tax sector.<\/p>\n
\"The city administration wants to increase revenues from
\nvarious sectors and the progressive car taxation is just the
\nbeginning. We will intensify the collection of regional revenues
\nfrom other sectors in the future,\" Surjadi emphasized.<\/p>\n
The governor said the Ministry of Home Affairs had already
\napproved progressive car taxation, which was first proposed by
\nthe City Council.<\/p>\n
Surjadi explained the new taxation system is also aimed at
\nhelping solve the nagging traffic problems in Jakarta.<\/p>\n
\"The implementation of the progressive tax system is
\nsynchronized with our effort to improve public transportation in
\nthe city,\" Surjadi said.<\/p>\n
The regulation, approved by the City Council last July, is
\ndesigned to increase municipal government revenue and to slow the
\ngrowth in the number of private cars by promoting the use of
\npublic buses.<\/p>\n
The regulation requires motorists to pay 120 percent of the
\neffective car tax rate for a second car. The tax rises to 140
\npercent for the third car, 160 percent for the fourth, 180
\npercent for the fifth and 200 percent for the sixth and
\nsubsequent cars.<\/p>\n
The municipal administration annually reviews the car tax
\nlevels to reflect changes in the market price of cars.<\/p>\n
According to the latest tax levels for cars, for example, 1993
\nor newer sedans with sale prices of less than Rp 50 million and
\nengines between 1,200 to 1,500 cubic centimeters (cc) are subject
\nto a tax of Rp 393,600 (US$177). Cars with 1,501 to 1,600 cc
\nengines are subject to a tax of Rp 458,400.<\/p>\n
Sedans made after 1993 with sale prices over Rp 120 million
\nand engines between 2,101 cc and 2,400 cc are subject to a tax of
\nRp 1.17 million.<\/p>\n
The tax is levied on families (as stipulated in the resident
\nfamily card), on companies and on other legal entities.<\/p>\n
A city councilor estimated that more than 186,000 car owners
\nwould be subjected to the new progressive fees.<\/p>\n
The Golkar faction at the House of Representatives urged the
\ncity administration to educate its officials about the tax and to
\ncooperate with city police as well as with the West Java and
\nLampung provincial administrations.<\/p>\n
The faction said these steps are important to avoid confusing
\nJakartans with the new tax regulation. (yns)<\/p>",
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