Development tax may be imposed in Riau
Development tax may be imposed in Riau
JAKARTA (JP): The government may impose a 10 percent
development tax on hotels and restaurants in Riau province to
support tourism, a minister said yesterday.
The minister of tourism, post and telecommunications, Joop
Ave, said imposing the 10 percent tax in Riau would pose no
problems given the province's fast growing tourism sector.
Joop said Riau had become one of Indonesia's most popular
tourist destinations, with Batam island, a special industrial
bonded zone in the province now turning into one of three major
entry points for foreign tourists in the country.
"It's a good idea to make Riau the 11th province to collect
the tax," he said after opening Golden Hotel here Saturday.
By Presidential decree, Indonesia's 10 most visited provinces
have to impose a 10 percent tax on hotels and restaurants.
The provinces are North and West Sumatra, Jakarta, West,
Central and East Java, Yogyakarta, Bali, North and South
Sulawesi.
Twenty percent of the funds collected from this tax go to the
Ministry of Tourism, Post and Telecommunications to be channeled
to the Indonesian Tourism Promotion Board.
Riau has become a favorite tourist spot for people living on
the province's two major islands, Batam and Bintan.
Batam, about 30 minutes by ferry from Singapore, is an
important industrial zone, while Bintan island is being developed
into a tourist resort.
The development of tourist facilities will enable the 120-
hectare Bintan Island to cope with a million visitors a year in
2000.
Batam's Hang Nadim international airport has been upgraded to
handle jumbo jets and this will further strengthen tourism.
Batam, 20 kilometers southeast of Singapore, has also been
developed as a tourist area as well as an export processing or
bonded industrial zone.
Hang Nadim airport has been selected as one Indonesia's seven
major entry points. The other major entry points are Entikong, on
the Indonesia-Malaysia border in West Kalimantan, and airports in
Jakarta, Bali, Medan, Surabaya and Manado.
Soekarno-Hatta airport in Jakarta was the major entry point
for foreign arrivals from January to April this year, accounting
for 38.1 percent of arrivals. Next was Bali's Ngurah Rai airport
(27.4 percent) and Batam island (26 percent).
The Ministry of Tourism, Post and Telecommunications has
earned Rp 47.16 billion in development tax over the past three
years, less than 20 percent of the targeted Rp 239.74 billion.
Many of the 10 local administrations have been reluctant to
pass on 20 percent to the ministry because they did not think the
promotion board did enough to bring foreign tourists to their
provinces. (icn)