Liquor free from luxury sales tax starting April 1

Thu, 25 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Om Pong

Quoting: KuKuKaChu

And as our economy has become intensively globalized and our country more popular as a tourist destination, we will inevitably be the host to a rising number of foreigners.

Exactly. "Visit Indonesia Year 2010 and Have A Nice Glass of Ribena". Holidaymakers want to get trousered every night and throw up into a hedge on their way back to the hotel. All seems very straightforward to me.

Thu, 25 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By KuKuKaChu

Freeing the liquor trade

The Jakarta Post | Editorial

The policy measures taken by Finance Minister Sri Mulyani Indrawati and Trade Minister Mari Pangestu in the importation, distribution and levying of alcohol drinks are greatly sensible, making the country more hospitable to foreigners.

Sri Mulyani scrapped the luxury sales tax � which by the law could be as high as 200 percent � on alcohol drinks, while Mari abolished state trading company Sarinah’s monopoly in the importation of liquor.

They freed liquor trade, yet still control the distribution and consumption of alcohol drinks through punitively high excise taxes.

However laudable and welcome these measures may be, they are still quite daring a move since liquor is a socially and politically sensitive subject in the country with the world’s largest Muslim population. The consumption of alcohol, even by only a tiny percentage of the population, has always been a lingering issue.

Experiences so far had shown the ineffectiveness of the high luxury tax rate in controlling liquor, which are seen by Muslims, who make up some 80 percent of the country’s population, as something that is strongly forbidden as sin.

Instead of cutting down on imports and contributing revenues to the state, the high luxury tax and the monopoly in the importation of liquor had caused import smuggling and illegal trading (black market) to thrive, notably in Jakarta and Bali, two areas with sizeable pockets of foreign communities and the most popular destinations for foreign visitors.

Until late 2006, two state trading companies were given the license in the lucrative liquor trading: Sarinah was the sole importer of duty-free liquor and Perusahaan Perda-gangan Indonesia (PPI) for importing duty-paid alcohols for the open market. However, the tough campaign launched by Sri Mulyani to clean up the notoriously corrupt customs service found in 2006 how collusion between PPI and customs officials had made it possible for most of the liquor imported for the free market to evade paying any duty, causing hundreds of millions of dollars in state losses and alcohol black market to thrive.

PPI lost its license in late 2006 and Sarinah was eventually assigned the sole importer of both duty-free and duty-paid liquor. However, the lack of experience made the transition chaotic, drying up liquor stocks between late 2007 and 2008 and setting off complaints among foreign visitors and expatriate communities in major cities such as Jakarta, Surabaya and Medan.

Minister Mari said eight companies had applied for liquor import licenses and she would decide soon how many of them would be granted the licenses because the new policy measures would be effective early next month.

Banking on past experience, it is much better to allow as many importers as possible as competition is the best driver of an efficient market. The measures will not, however, make liquor available at very cheap prices to everybody as alcohol drinks remain subject to punitively high excise taxes that will be twice as high as their current rates.

The trade liberalization will discourage black market, while the high excise taxes will serve to control liquor production, imports and distribution and consumption.

Of most important is for the trade and finance ministries to design an importation and distribution system that is easy to oversee, yet effective in controlling liquor sales to the targeted market niche � foreign visitors and residents.

Liquor drinking is increasingly part of modern lifestyles. And as our economy has become intensively globalized and our country more popular as a tourist destination, we will inevitably be the host to a rising number of foreigners.

Thu, 25 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By KuKuKaChu

Indonesia's Tax Hike on Alcohol �to Fuel Black Market’

by Irvan Tisnabudi

Indonesia is likely to see higher prices for alcoholic beverages and more black market trading as a result of the government’s decision to effectively replace the luxury tax on alcohol with a higher rate of excise tax, industry players said.

Just over a week after the government said it would scrap the luxury tax from April, the Finance Ministry on Tuesday released a decree that raised the excise tax on alcoholic drinks by 100 percent to 214 percent, depending on the alcohol content.

Krisnadi , chairman of the Indonesian Hotels and Restaurants Association (PHRI), told the Jakarta Globe that the move would trigger more black market trading of alcoholic beverages.

“Based on my understanding, the government was cutting the luxury tax for alcoholic beverages to make the [liquor] price cheaper in the market,” he said. “But now that they’ve decided to increase the excise tax for alcoholic beverages it will lead to the same old problems for retailers, such as inadequate supplies and high prices.”

Prior to the removal of the luxury goods tax and the increase in the excise tax, many alcoholic drinks cost as much as 500 percent more than their wholesale price by the time they were sold in bars and restaurants. Such high prices led to a growth in illegal imports.

Ipung Nimpuno, a representative of the Indonesian Malt Beverages Association (GMMI), said on Tuesday that the increase in the excise tax could cause prices of alcoholic beverages to soar by 20 percent to 40 percent.

Jonker Hamonangan, head of the Jakarta branch of the Indonesia Customs Services Association (Asakindo), an organization comprised of executives whose businesses sell goods that are subject to excise tax, said the new tax would lead to price increases of 10 percent to 40 percent, depending on the alcohol content.

Christoph Darjanto, who manages the Immigrant bar in Jakarta, said his suppliers will decide whether to raise prices.

“If the price increases, demand and sales will no doubt be affected,” he said.

Teguh Yudo Wicaksono, a researcher at the Centre for Strategic and International Studies, said the excise tax rise would have a bigger impact on consumers of type A drinks like beer, who tend to have lower incomes.

“With more money to spend, [those who drink type B and type C drinks] won’t be affected too much by the higher price,” Teguh said.

Type A beverages have an alcohol level of 5 percent or less. Type B drinks have an alcohol level of 5 percent to 20 percent, and type C drinks contain more than 20 percent alcohol.

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By v8dave

Quoting: KuKuKaChu

He added that because the issue was related to health, consumption should be limited, as with cigarettes. The tax on cigarettes is increased by 10 percent to 30 percent yearly.

What a load of shite!! They are still miles cheaper than anywhere else in the world and almost all Indonesians smoke but not as many drink alchohol!!! Err, you idiots have got it the wrong way around!!! DOH!

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Vulgarian

That eye for detail's why Om makes the big bucks.

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Om Pong

The Cunt!!

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By KuKuKaChu

Quoting: Vulgarian

Also, check the typo.

I give up. where?

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Vulgarian

Also, check the typo.

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Om Pong

Fuckin Muppets indeed. What a travesty.

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Vulgarian

Wed, 24 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By KuKuKaChu

the jezabel! we've been betrayed!!

Cheers to Jeers: Indonesia Trades One Alcohol Tax for Another

by Irvan Tisnabudi

Just over a week after the country’s producers of alcoholic beverages applauded the government’s move to scrap the luxury tax on their products from April, they are now indignant over the government’s sudden decision to increase the excise tax by up to threefold.

A Finance Ministry decree signed on March 17 but released only on Tuesday raised the excise tax on alcoholic beverages by 100 percent to 214 percent, depending on their alcohol content. The luxury tax currently imposed on alcoholic beverages ranges from 40 percent to 150 percent of their sales price.

“We appreciate the government’s efforts in scrapping the luxury tax on alcoholic beverages, but the increase in the excise is just way too much,” Ipung Nimpuno, a representative of the Indonesian Malt Beverages Association (GMMI), told the Jakarta Globe.

He said the increase in the excise tax could undermine the objective behind scrapping the luxury tax: reducing the black market in alcoholic beverages.

“I haven’t figured out how much is the proper excise the government should charge in order to compensate for the scrapped luxury tax, but the current figure is too much,” Ipung said. He added that he expected prices of alcoholic beverages to increase by 20 percent to 40 percent with the new excise duty.

The government divides alcoholic beverages into three categories: type A, containing up to 5 percent of alcohol, type B, with 5 percent to 20 percent, and type C, with more than 20 percent.

The new decree raises the excise tax on domestically produced type A drinks from Rp 3,500 (38 cents) per liter to Rp 11,000. The excise on type B beverages is increased from Rp 10,000 to Rp 30,000 per liter and on type C beverages from Rp 25,000 to Rp 75,000 per liter.

Meanwhile, for imported alcoholic drinks, the excise for type A is increased from Rp 5,000 to Rp 11,000 per liter, for type B from Rp 20,000 to 40,000 per liter and type C from Rp 50,000 to Rp 130,000 per liter.

The decree says the new excise tax rate is aimed at compensating for the expected drop in revenue from the abolition of the luxury tax on alcoholic beverages.

Ipung said that when the luxury tax was still in place, Indonesian brewers had been contributing about Rp 4 trillion annually to the state coffers.

“With the luxury tax scrapped and the excise tax increased, we [GMMI] predict that beer producers will now have to contribute Rp 4.8 trillion yearly,” he said.

Evi Suhartantyo, a spokesman for the Directorate General of Customs, said the current level of excise duty for alcoholic beverages was “ideal.”

“Objects that are charged with excise have their excise tax increased every year, because it is done to protect the health and well-being of our people,” Evi said.

He added that because the issue was related to health, consumption should be limited, as with cigarettes. The tax on cigarettes is increased by 10 percent to 30 percent yearly.

Tue, 16 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By KuKuKaChu

gives me the 'orn, she does.

Tue, 16 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Vulgarian

She's fuckin' shexy an' all. I f-f-f-fuckin' luv her.

Tue, 16 Mar 2010

JAKCHAT/Liquor free from luxury sales tax starting April 1

From: JakChat

By Marmalade

Dear Sri, I love you. I don't care if you threw the country's money away on an ailing bank. As long as you get it back by reducing tax on booze. Hic, cheers love. You are my very best friend in the world, love. Hic.

Tue, 16 Mar 2010

ANT/Liquor free from luxury sales tax starting April 1

From: Antara News

Jakarta (ANTARA News) - Under a newly enacted fiscal law, alcoholic beverages will no longer be subject to luxury good sales tax effective next April 1, Finance Minister Sri Mulyani announced here Monday.

"Under the newly enacted law on value added and luxury good taxes, alcoholic drinks are free from luxury good sales tax as of next April 1. We will adjust the relevant tariff accordingly," the minister said after attending an illegal liquor destruction event.

She said the Trade Ministry was now also evaluating and on the point of adjusting its regulations on the liquor trade to the new law and thereby reduce the liquor smuggling frequency and ensure the state`s income from duties.

Meanwhile, Director General of Duties and Excises Thomas Sugijata said under the new fiscal law, alcoholic beverages would henceforth be subject only to customs duties.

"There will be a revision of the income from duties target because starting April 1, 2010 we no longer collect luxury good sales tax from alcoholic beverages," he said.

With the scrapping of the luxury good sales tax on alcoholic beverages it was hoped state income from duties on imported alcoholic drinks would increase. So far imported liquor has been subject to duties, luxury good sales tax and value added tax which combined can amount to 400 percent of the beverage`s price. (*)