Govt maintains ceiling on luxury sales tax
Govt maintains ceiling on luxury sales tax
JAKARTA (JP): The government has decided to maintain the sales tax ceiling on luxury goods at 35 percent, even though the new tax laws, which went into effect early this month, allow for the rate to be raised as high as 50 percent.
"The government does not yet see it necessary to apply the maximum luxury sales tax rate," Tax Director General Fuad Bawazier said.
The new luxury sales tax rates will remain in the same 10 percent to 35 percent range as before. The rates, stipulated in the decrees released yesterday by the Minister of Finance, are to go into effect immediately.
It should be noted, though, that the luxury sales tax is applied on top of the 10 percent value added tax.
Finance Minister's Decree No. 644 sets a 10 percent luxury sales tax on: Dairy products, yogurt, cocoa, whey, fruit and vegetable juices, beverages -- including mineral water -- perfumes and toilet waters, beauty or make-up preparations and preparations for the care of skin and for use on hair, pre-shave and shaving or after-shave preparations, household utensils such as refrigerators, heaters, stoves, ranges, grates and cooks, storage water heaters and immersion heaters, TV receivers and video recorders and luxury houses.
Goods which are subject to 20 percent luxury sales tax include: Carpets, sanitary wares and parts, except those made of plastics, cement and galvanized iron, photographic films and instant print films in rolls, lenses, prisms, mirrors and other optical elements, binoculars, cameras, microphones, record players, magnetic tape recorders, magnetic discs, records, tapes and other recorded media for sound, air-conditioning machines, pianos and other musical instruments.
Goods which are subject to a 35 percent luxury sales tax include: Alcoholic drinks, including beer made from malt, vermouth, cider and perry and indentured ethyl alcohol, saddlery and harness for any animal, trunks, suit cases, brief cases, handbags, traveling bags, toilet bags, articles of apparel of furskin and artificial fur, footwear, except those made locally, worked monumental or building stones, granite, mosaic cubes, wares made from lead crystal, foreign-made tableware, kitchenware and other household articles, foreign-made articles of ceramic, wrist watches and other watches, articles of jewelry, diamond, aircraft for private use, cruise ships, golf clubs and other golf equipment, sports diving equipment, chandeliers and other electric ceiling and video games.
Motor vehicles
The government also maintained the rates of the luxury sales tax on motor vehicles at 20 percent, 25 percent and 35 percent.
The 20 percent luxury sales tax is imposed on imports of motorcycles (including mopeds), with a capacity of up to 250 cc and on the transfer of sedan, station wagon with a capacity of up to 1,600 cc and on the sales of jeeps assembled with 60 percent locally made components, and the transfer of light commercial cars to be used for public transportation.
The 25 percent tariff is imposed on imports and transfer of combi's, minibuses, vans and pick-ups using diesel fuel, the transfer of minibus chassis or pick-up which would be modified into minibus, vans and combi, using gasoline fuel.
The 35 tariff is set on the transfer of motorcycles with a capacity of above 250 cc, on imports of buses, on imports and the transfer of sedans, station wagons and jeeps with a capacity of above 1,600 cc, racer car and caravan.
Imports and the transfer of motorcycles and four-wheeled vehicles to be officially used by police and other units of the Armed Forces are exempted from the luxury sales tax.
Imports and transfer of vehicles to be used as ambulances, prisoners' cars, and as public and cargo transportations are also exempted from the luxury sale tax.(vin/hen)