Business uproar mounts as Indonesia pushes VAT hike amid sluggish demand
Set to take effect on Jan 1, it adds pressure to an already fragile economy, stoking fears of reduced consumer spending and strained business operations
Add BT as a preferred source
[JAKARTA] Indonesia’s plan to hike its value-added tax (VAT) to 12 per cent, from 11 per cent, starting on Jan 1 has triggered a wave of backlash from consumers and businesses, intensifying fears of weakened spending and economic instability, while placing the country alongside the Philippines as having the highest VAT rate in South-east Asia.
As the clock ticks down, the looming tax hike in South-east Asia’s largest economy is deepening the uncertainty surrounding Indonesia’s economic outlook, posing a significant challenge to President Prabowo Subianto’s ambitious economic agenda.
Several business groups have intensified their lobbying efforts, urging the government and parliament to postpone the hike, warning that the policy could erode consumer purchasing power already strained by rising costs.
TRENDING NOW
On the board but frozen out: The Taib family feud tearing Sarawak construction giant apart
As more Asean states turn to Russia for fuel, will Moscow boost its influence in the region?
Thai and Vietnamese farmers may stop planting rice because of the Iran war. Here’s why
Is it time to scrap COE categories for cars?
