25% import duty on cellular phones lifted

JAKARTA (JP): Imports of cellular phones will likely increase now that the government has lifted the import duty on several telecommunications products, a senior executive says.

"Prices of handsets will absolutely drop when the government lifts the import duty, which means that more people can now afford to purchase them," a director of PT Telkomsel, Garuda Sugardo, told The Jakarta Post yesterday.

PT Telkomsel, which is jointly owned by PT Indosat and PT Telkom, is one of the country's three operators of the global system for mobile communications (GSM).

The government announced on Tuesday that it has lifted the 25 percent import duty on telephone handsets.

Garuda said that the decision of the Ministry of Finance to abolish the import duty must be praised, as the global market has shown that handset prices are steadily declining.

"But Indonesia should remain selective in importing cellular telephone handsets even though the import duty has been lifted," he said.

He said that there are currently about 35 products acknowledged as GSM handsets, of which 13 have been approved by Telkomsel.

He suggested that import selection should be based on the quality of after-sale services.

According to Garuda, the price of Telkomsel's handsets will likely decrease from Rp 2.5 million (US$1,096) at present to Rp 2 million in the near future.

The prices of handsets in Indonesia are far more expensive than in other countries due to the imposition of several levies, including taxes and an import duty. (icn)