Government to abolish levy for Soeharto's foundation
Government to abolish levy for Soeharto's foundation
JAKARTA (JP): President B.J. Habibie will soon issue a
presidential decree to abolish the 2 percent levy imposed on
individual and corporate taxpayers to finance former president
Soeharto's poverty-alleviation program, Minister of Finance
Bambang Subianto announced yesterday
He also said that Habibie would revoke a 1988 presidential
decree which required producers of cigarettes, alcoholic
beverages and other products subject to excise stamps to pay an
additional Rp 1 for each stamp they purchased from the
Directorate General of Customs and Excise. This levy was
allocated to fund the scouting movement.
Speaking to reporters after an economic cabinet meeting,
Bambang said the planned revocations were aimed at improving the
state's financial discipline and providing certainty to the
business community.
"Those rulings are not consistent with budget discipline
because they are not aligned with the budget. On the other hand,
they create confusion among investors in calculating their
taxes."
Presidential Decree No.90/1995, later superseded by
Presidential Decree No. 92/1996, requires individuals and
companies with annual after-tax incomes or profits of more than
Rp 100 million (about US$9,000 at current exchange rates) to
donate up to 2 percent of their earnings to the privately run
Dana Sejahtera Mandiri Foundation to fund poverty-alleviation
schemes.
Soeharto established the foundation in January 1996 and
remains its chairman.
Soeharto's close associate Sudono Salim, also known as Liem
Sioe Liong, who chairs the giant Salim Group, cousin
Sudwikatmono, son Bambang Trihatmodjo and Sudono's son Anthony
Salim were also involved in the foundation's operation.
Coordinating Minister for People's Welfare/Poverty Eradication
Haryono Suyono said Tuesday that Soeharto's chairmanship of the
foundation could be reviewed.
Haryono also reported that the foundation had collected a
total of Rp 1.5 trillion (about US$135 million at current rate)
from taxpayers and channeled about Rp 1 trillion to poor families
across the country, especially in Java.
He hoped the affluent would continue to voluntarily make
donations to the foundation.
Bambang said the poverty-alleviation program would continue
through funding from the state budget.
"Of course, we must consider the state financial situation so
that all immediate needs for funds can be met proportionally," he
said. (prb/rid)