- The Indonesian government has confirmed that the value-added tax (VAT) rate of 11% will remain in effect this year.
- However, a new law mandates an increase in the VAT rate to 12% by January 1, 2025.
- The government can still postpone the increase with certain considerations.
- The VAT rate can be changed to a minimum of 5% and a maximum of 15% based on economic considerations and the need for increased funds for development.
- The government has one year left to implement the VAT rate increase and hopes to encourage businesses to be ready to pay 12% VAT in 2025.
- Some experts believe that the government does not need to revise or lower the VAT rate in 2025 as it would make it more difficult to achieve the mandated increase.
- Adjustments to the VAT rate need to be made based on the economic conditions of 2025.
- Sectors that have not yet recovered can receive fairer tax treatment to catch up with growth.
- The option of a tax rate range of 5% to 15% is relatively fair for determining VAT in 2025.
Source: english.kontan.co.id
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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