Tourism board slow to receive tax revenues
Tourism board slow to receive tax revenues
JAKARTA (JP): The Indonesian Tourism Promotion Board, a semi-
governmental body assigned to promote the country's tourism
industry abroad, has only received Rp 31.12 billion, or 26
percent of the Rp 120.17 billion expected in development taxes.
The managing director of the board, Wuryastuti Sunario, said
at a two-day discussion on tourism yesterday that the Rp 31.12
billion (US$13.28 million) was received in 1994/1995 and
1995/1996 after a decree was issued in 1993 allowing the use of a
portion of development taxes for tourism industry promotion.
Based on Presidential Decree No. 6/1993, the government
requires the 10 provinces most frequented by tourists -- North
and West Sumatra, Jakarta, West, Central and East Java,
Yogyakarta, Bali, North and South Sulawesi -- to pass on one-
fifth of their revenues from the 10-percent development tax to
the Ministry of Tourism, Post and Telecommunications. The
collected funds will then be channeled to the Indonesian Tourism
Promotion Board for promotion activities. The remaining 80
percent will go to local administrations.
Tuti told the meeting, which ended yesterday, that her board
has never received the funds expected from the taxes.
According to Tuti, of the Rp 120.17 billion ($51.3 million)
originally expected from taxes in the 1994/1995 and 1995/1996
periods, the Jakarta administration should have contributed 52
percent, Bali 20 percent, West Java 8.1 percent, East Java 7.2
percent, Central Java 6.3 percent, North Sumatra 3 percent,
Yogyakarta 1.7 percent, South Sumatra 0.8 percent, West Sumatra
0.7 percent and North Sulawesi 0.6 percent.
However, South Sumatra has paid only 86 percent of its
expected payments, East Java 69 percent, Yogyakarta 51 percent,
West Sumatra 50 percent, North Sulawesi 49 percent, North Sumatra
44 percent, West Java 39 percent, Central Java 30 percent,
Jakarta 22 percent and Bali 6 percent, she said.
Indonesia, through the tourism promotion board, needs tens of
millions of dollars for the promotion of its tourism industry,
she said.
The number of tourist arrivals in Indonesia reached 4.3
million last year, bringing in some $5.2 billion in foreign
exchange. The number of visitors is estimated to increase to more
than six million by 1998 and to 11 billion by 2005.
The Indonesian Hotel and Restaurant Association has reported
several times that the main problem with the channeling of funds
is at the local administration level, which receives tax payments
from the association's members.
The Indonesian Tourism Promotion Board, which was set up in
1991 as an independent body, spent more than $20 million last
year on promotional activities and overseas advertisements in
print and electronic media.
Tuti said that the board used bridging loans from private
firms to cover its operating costs in 1995/1996.
"Currently, 89 percent of the board's funds come from the
government and 11 percent from private firms. By 2005, when
competition in the global market will be fiercer, we expect the
funding to come equally from the government and private firms,"
she said.
The discussion, held by the Indonesian Hotel and Restaurant
Association, focused on tourism in the Seventh Five-Year
Development Plan (Repelita VII) period. (icn)