Jakarta Governor reviews tax cut to counter global uncertainty

Governor Pramono noted that current international conditions—including conflicts in the Middle East and the potential economic fallout from El Niño—pose significant challenges to the capital’s economy.

“We are currently reviewing regional tax reductions. Jakarta intends to issue more competitive and attractive tax instruments,” Pramono stated.

He expressed hope that these measures would provide necessary relief for both the public and the business community amidst global uncertainty, helping to sustain the city’s economic momentum.

The governor explained that the proposed relief will be delivered through several incentive packages, which are currently in the final stages of development.

He emphasized that the administration must respond to these geopolitical and economic pressures by offering fiscal relaxation, with the full tax policy package expected to be announced in due course.

The primary goal of the policy is to stimulate local economic activity and ensure continued stability.

Despite global headwinds, Pramono confirmed that Jakarta’s economy remains robust, with growth rates exceeding the national average and inflation staying well-regulated.

To illustrate the city’s economic health, Pramono highlighted that Jakarta’s inflation rate stands at 3.37 percent, which is notably lower than the national average of 3.48 percent.

With economic growth outpacing national trends, he suggested that the capital’s economy remains well-maintained.

However, Pramono emphasized that the Jakarta Provincial Government is adopting a cautious approach to fiscal policy.

The administration aims to strike a balance between providing a necessary stimulus and maintaining the integrity of the Regional Budget (APBD).

The objective is to maintain positive economic momentum while providing the community and businesses the breathing room they need to navigate global pressures, Pramono said.

Translator: LIfia Mawaddah Putri, Cindy Frishanti Octavia