VAT privileges for SMEs

VAT privileges for SMEs

Small and medium enterprises (SMEs) are the true heroes of the Indonesian economy. While many conglomerates collapsed as a result of the economic crisis that engulfed the country, SMEs have withstood the impact of the crisis, despite skyrocketing lending interest rates and the rupiah's extraordinary depreciation against the U.S. dollar.

Of course, they could not afford to employ professional managers. Neither do they have the money to hire consultants to make business strategies and forecasts. They do not even have adequate access to banking facilities. Yet, these "shortcomings" have become their strength amid economic uncertainty.

It is not because the government considers SMEs as strong that it has paid little attention to them. Like other business groups, SMEs deserve to have access to banking facilities, business information and other privileges.

In this context, the Finance Ministry's move to raise the turnover limit of SMEs as untaxable entrepreneurs from Rp 360 million to Rp 600 million is praiseworthy.

-- Bisnis Indonesia, Jakarta