Exit tax burdens small businesses

Exit tax burdens small businesses

JAKARTA (JP): Exit taxes imposed on Indonesians traveling
abroad are particularly a burden on small-scale businessmen
looking to promote exports and students pursuing education in
foreign countries, according to an analyst.

Director of the Indonesian Business Data Center Christianto
Wibisono said in a seminar on youth tourism held at the Ministry
of Tourism, Post and Telecommunications yesterday that small-
scale businessmen who visit overseas countries frequently have to
allocate money for the tax which they should be able to use to
improve the competitiveness of their products overseas.

"The justification for the exit tax has become questionable as
the government plans to exempt people traveling within the
economic growth areas of the Association of Southeast Asian
Nations (ASEAN) from the regulation," he said.

The government announced last month that the planned exemption
in the growth areas is expected to encourage Indonesian travelers
to go to other ASEAN members involved in the growth areas.

The exemption, based on Government Regulation No. 57/1996, has
not been made effective yet.

Eighteen Indonesian provinces are included in one of the three
subregional economic cooperation areas, or growth triangles,
which link all ASEAN countries except Vietnam. These areas are
the Indonesia-Malaysia-Thailand Growth Triangle, the Indonesia-
Malaysia-Singapore Growth Triangle and the Brunei-Indonesia-
Malaysia-Philippines East ASEAN Growth Area.

To support the new regulation, Riau Governor Suripto proposed
yesterday that the government should declare Riau's four
seaports, Dumai, Tanjung Pinang, Tanjung Balai Karimun and Selat
Panjang, as gateways for travelers to be exempted from exit tax
under Government Regulation No. 57/1996.

Based on Government Regulation No. 10/1994, Indonesians
leaving the country through airports are required to pay Rp
250,000 (US$107) and those leaving through seaports are charged
Rp 100,000.

Christianto said yesterday that on account of the planned exit
tax exemption within the ASEAN economic growth areas, the
government apparently plans to increase the exit tax to Rp
400,000 at airports outside the growth areas. (icn)