JAKARTA (Reuters) – Indonesia will on Monday announce an economic policy package, including its decision on the value-added tax rate, its senior economic minister said after a meeting with President Prabowo Subianto.
The government has previously said Indonesia would increase the VAT rate to 12% from the current 11% in January 2025, but only for luxury items, as a means of supporting low-income people.
“There will be certain tariffs, but staple goods would not be subject to VAT,” Coordinating Minister for Economic Affairs Airlangga Hartarto told reporters on Friday.
Almost all products and services are currently subject to VAT, except for staples and some items and services related to education and health.
Indonesia has said it will introduce fiscal stimulus for labour-intensive industries and some assistance for the poor to pay electricity bills.
(Reporting by Stefanno Sulaiman; Writing by Ananda Teresia; Editing by Martin Petty)
