Luxury tax imposed on 41 products

JAKARTA (JP): The government has imposed a luxury sales tax of between 10 percent and 75 percent on 41 items of consumer goods including small size television sets and other home appliances.

The Ministry of Finance announced on Wednesday the new luxury tax, which became effective early in January, was needed to boost tax revenues and prevent the country from being flooded with imported luxury items.

"The imposition of the high luxury tax is intended to increase tax revenue and to curb the inflow of luxury goods into the country," Hadiyanto, the spokesman for the ministry, said in a statement.

A 10 percent luxury tax has been imposed on products such as milk, cheese, yogurt, butter, nonalcoholic beverages, cosmetics, sports equipment, TV sets (with screens smaller than 21 inches), refrigerators with a capacity of less than 230 liters and toys.

Other products are subject to a 20 percent luxury tax. These include refrigerators with a capacity of more than 230 liters, heaters, air conditioners, houses larger than 400 square meters, houses with a power supply of more than 6,600 watts, apartments, condominiums, sanitary equipment except those made of plastic or cement, equipment used in cinematography, tape recorders, musical instruments, washing machines, deodorants and TV sets with screens between 21 inches and 29 inches in size.

Luxury taxes of 30 and 40 percent have been slapped on yachts, TV sets with 29-inch to 43-inch screens, drinks which contain less than 26 percent alcohol, leather products, glassware, gold or silver-coated ornaments, billiard tables, video games, furniture valued at more than Rp 500,000 and collectables made of porcelain and ceramic.

Luxury taxes of between 50 percent and 75 percent has been imposed on helicopters, airplanes, golf clubs, rifles, drinks containing more than 26 percent alcohol, motorboats and jewelry.

"The new taxes will not affect products or goods bought for the state or for public use," the ministry added. (03)