Finance Minister Purbaya ready to offer 0% tax incentives in financial SEZ

Jakarta (ANTARA) - Finance Minister Purbaya Yudhi Sadewa has stated his readiness to offer tax exemptions on assets from global investors entering the Special Economic Zone (SEZ) for finance or International Financial Centre (IFC) in Bali.

Purbaya explained to reporters at the Ministry of Finance office in Jakarta on Monday that such tax incentives could benefit Indonesia, including by strengthening foreign exchange reserves (cadev).

“If requested, I’ll give 0%. Why would I do that? With that, 0% tax is fine, but money enters there (the financial SEZ). That should be linked to our foreign exchange reserves as well, right, strengthening them,” said Purbaya.

In addition to cadev, Purbaya believes positive impacts will also be seen in Indonesian bonds. He hopes that assets entering the SEZ can encourage the number of foreign investors in the government securities (SBN) market.

“They can buy government bonds. If they ask for low interest, I’ll provide the facility. Why? It can reduce pressure on our bonds from other buyers in America or elsewhere. So, the supply of our bond buyers will increase,” explained Purbaya.

“This is a strategic step that may soon be realised in the near future,” he added.

He explained that the Ministry of Finance is involved in the development of the IFC alongside the Coordinating Ministry for Economic Affairs and the Danantara Investment Management Agency (BPI).

According to Purbaya, the legal system, including the application of incentives, that will apply in the financial SEZ will refer to international standards.

Previously, Coordinating Minister for Economic Affairs Airlangga Hartarto stated that the Kura Kura Bali SEZ is being accelerated in its development as one of the potential locations for developing the financial sector SEZ in Bali.

The government is refining regulations as the foundation for establishing the financial sector SEZ in Bali. The SEZ is designed to accommodate various needs for establishing a financial centre, from management schemes to providing facilities capable of attracting global investors.