Jakarta Government Proposes Revision of Regional Tax and Levy Regulation

The Jakarta Provincial Government has proposed material changes to Regional Regulation Number 1 of 2024 concerning Regional Taxes and Levies to align with regulatory developments, address community needs, and accommodate economic dynamics. “It is hoped that the proposed changes to the regulation will encourage economic activity within the community, particularly in the current economic climate,” said Deputy Governor of Jakarta Rano Karno during a plenary session of the Jakarta Regional House of Representatives on Monday. Rano stated that the current provisions for collecting regional taxes and levies are formally and materially regulated in Regional Regulation Number 1 of 2024. This regulation has been in effect for nearly three years and has undergone various assessments and evaluations of its content, making amendments necessary. He outlined several key points in the proposed amendments, including clarifying the definition of public vehicles in relation to motor vehicle fuel tax collection, affirming the exemption of certain goods and services tax on electricity, expanding the exemption of objects from advertisement tax, expanding the exemption of levy objects for cleaning services for state educational units, and adjusting several other regional levy tariffs to align with current needs. The collection of regional taxes and levies is one of the main sources of locally generated revenue, which supports the operational financing of Jakarta’s governance and development. “The contribution from these two revenue sectors is vital for the continuity of government activities and both physical and non-physical development,” Rano said.