Legislators, editors reject tax on reading materials

Legislators, editors reject tax on reading materials

Kurniawan Hari, The Jakarta Post, Jakarta

In an effort to lower book, newspaper and magazines prices,
editors and legislators on Thursday agreed to demand the
government remove the imposition of value-added tax (VAT) on
reading material.

They said getting rid of the tax would bring down the prices
of newspapers, magazines, and books which would boost sales and
increase reading among the public.

Deputy Chairman of House Commission I for broadcasting and
media Effendy Choirie pledged his commission would soon discuss
the matter with the Minister of Industry and Trade and the
finance ministry's director general.

VAT accounts for 10 percent of the prices of printed material.
It means an additional cost for readers.

Leo S. Batubara of the Association of Newspaper Publishers
(SPS) said the total amount of VAT paid by newspapers to the
government was Rp 140 billion last year. As of June this year, he
said, the amount had reached Rp 70 billion.

"Knowledge should not be taxed," Leo said.

He added the high prices of newspapers were also to blame for
their low circulation.

There are about 566 publications in Indonesia, but only 30
percent of them are profitable.

Home to more than 210 million people, Indonesia's daily
newspaper circulation stands at 4.8 million copies, far below the
United Nations Educational, Scientific, and Cultural
Organization's (UNESCO) ideal daily circulation of 22 million
copies.

Chief editor of Media Indonesia daily Saur Hutabarat suggested
the public should not be required to pay VAT on books and
newspapers.

"Books and newspapers educate the public. Therefore, there
should be no need to impose VAT on those items," said Saur.

Chief editor of Kompas Suryopratomo and deputy chief editor of
The Jakarta Post Endy M. Bayuni agreed with Saur that the VAT
must be dropped.

"VAT has raised the prices of books and newspapers," said
Suryopratomo.

A number of legislators clearly expressed their support for
the removal of value-added tax imposed on books and newspapers.

"Tax on knowledge is senseless. This must be removed," said
legislator Astrid S. Susanto.

During the hearing, legislators also questioned the
performance of Antara state news agency.

Head of Antara Mohammad Sobary said he had decreased the
agency's deficit from Rp 7 billion to Rp 2.3 billion and fired
several employees found guilty of embezzlement and fraud.