Thu, 11 Aug 1994

Tax on import goods

May I crave a few of your valuable column inches to finally bring down the curtain on the drama of the Rp 29,680 charge on the import (via airmail) of a videocassette (cost price 8 Pounds, about Rp 27,000 at today's date rate of exchange). My reason for writing again is that on Aug. 9, 1994 I was surprised (and pleased) to be called upon at my office by two quite senior Post Office officials. They visited me at the behest of the Head of Public Relations at the Post Office, in connection with my recent letter in The Jakarta Post, entitled Post Office levy.

In that letter I had complained of the above outrageous charge, and that, when my wife had made an initial enquiry at the South Jakarta Post Office, she had been told that it was "in the computer." A somewhat cryptic answer from a counter clerk! She accordingly went to the Main Post Office to enquire further, since in my letter I had suggested that such an enormous levy could only be due to a little "Manipulation" (i.e. fiddling) with the computer, so that a tidy sum could find its way into the pocket of some needy Post Office worker.

I was wrong. My visitors explained to me most courteously that the vast imposition of import duty + VAT + Luxury Tax on a videocassette (even a blank) was nothing to do with the Post Office. It seems that what happens is that any package (even a small one, containing just one videocassette) that arrives at the Post Office should be sent to Customs Excise for inspection. In fact, when my wife went to raise the matter at the Main Post Office, she was referred to a very senior Customs & Excise official, with epaulets (C & E share the Post Office building), who explained that these were indeed the taxes that had recently been imposed on videocassettes entering this country, regardless of value or content.

Therefore I am happy to report that the Post Office is blameless in this matter, apart from passing certain packages to Customs & Excise, which they are obliged to do. One question remains unanswered, however, and I should be grateful if a Customs & Excise official could call on me to explain what was not explained to my wife by the senior official she spoke with.

The question is this: How on earth can such a precise figure of tax (Rp 29,680) be arrived at without reference to the cost/value of the item subjected to those three levies--import duty, VAT and Luxury Tax? Would the taxes be the same if the article was worth US$ 10 or $ 100? I can hardly believe that to be so, yet from what I hear from the Post Office, that is what C & E appear to be telling us. How can a boring little thing like a videocassette attract over 100 percent in taxes, irrespective of its actual value? The Post Office is exonerated. Now let's hear from Customs & Excise!