Snags in bonded zones deter investment<\/p>\n
Eva C. Komandjaja, The Jakarta Post, Jakarta<\/p>\n
Several bonded zone operators complained on Monday about the
\ndifficulties they faced in obtaining permits and the various
\nregional levies and taxes imposed by local administrations.<\/p>\n
The bonded zone operators that attended a hearing with the
\nHouse of Representatives Commission V are: PT Jakarta Industrial
\nEstate Pulogadung (JIEP), PT Kawasan Berikat Nusantara (KBN), PT
\nSurabaya Industrial Estate Rungkut (SIER), PT Kawasan Industri
\nMedan (KIM), PT Kawasan Industri Wijaya Kusuma (KIW) and PT
\nKawasan Industri Makassar (Kima).<\/p>\n
Each zone is subject to the individual regulations of its
\nrespective regency, established in accordance with Law No.
\n22\/1999 on regional autonomy. The regental administrations thus
\ncollect levies and taxes from businesses for permits and
\nlicenses, such as building permits (IMBs), investment permits and
\nbuilding use permits (HGB).<\/p>\n
The operators suggested that it would be more efficient and
\nstreamlined for the central government to provide a one-stop
\nservice for processing all requisite permits and licenses.
\nBesides cutting out unnecessary fees and levies, it would save
\ntime and eliminate all complications facing investors.<\/p>\n
They also complained about the 8 to 10 percent rise in value
\nadded tax (VAT) on purchasing or renting lots in industrial
\nestates, which had scared off investors.<\/p>\n
PT SIER claimed they had lost 18 investors due to the obscure
\nlevies, rising tax and difficulties in obtaining permits.<\/p>\n
The value of taxable property (NJOP) in industrial estates was
\nalso higher than in other locations, so many companies preferred
\nto set up their factories outside the estates.<\/p>\n
However, this may increase the possibility of water or air
\npollution, particularly for companies without their own waste
\ntreatment facilities. In industrial estates, the operators
\nprovide waste management services to their tenants, so pollution
\nis checked.<\/p>\n
One of the hearing's main concerns dealt with the lack of
\ninfrastructure, such as roads and other means of access to the
\nindustrial estates. The operators said local administrations
\nshould provide such key facilities, instead of the owners or
\ntenants of the industrial estates.<\/p>\n
In addition, they said insufficient electricity supplies would
\nnegatively affect the businesses. It was predicted that in 2004,
\nthe area spanning Java to Bali would suffer an electricity
\nshortage.<\/p>\n
The operators said they had to provide their own generators to
\novercome the lack of electricity, while PT KIM reported that
\ntheir electricity line was often cut off temporarily, which
\nhampered operations.<\/p>\n
Such difficulties would likely lead to a decline in new
\ninvestor interest, which would in turn slow the economy. Many
\nforeign investors have already withdrawn their investments from
\nIndonesia and moved to other Asian countries, such as Vietnam or
\nChina, due to the frustrations and inefficiencies they
\nexperienced here.<\/p>\n
Bonded zones are specially delineated areas that have been
\ngiven certain privileges under Indonesia's customs regulations.
\nAll goods imported into these zones -- whether international or
\ndomestic -- are exempt from excise fees until the goods are
\nexported or re-exported.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/snags-in-bonded-zones-deter-investment-1447893297",
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"sponsor": "Okusi Associates",
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