President’s Gift for New Year: PPN Rate Freeze at 11 Percent
As the clock struck midnight on January 1, 2025, Indonesians welcomed the new year with the unexpected yet welcome news of a presidential gift from Prabowo Subianto. The President has decided to scrap the planned increase of the Pajak Pertambahan Nilai (PPN) rate from 12 to 11 percent.
In a press conference held on Wednesday, January 1, Coordinator Minister for Political, Legal, and Security Affairs, General (Ret.) Budi Gunawan, shared the president’s New Year message. According to him, President Subianto wished for all Indonesian citizens to receive blessings, kindness, peace, and prosperity. Thus, he chose to forgo the PPN rate hike as a special gift for the new year.
The PPN rate hike was initially announced to target only luxury goods and services consumed by higher-income individuals. Basic necessities would still be taxed at the existing 0 percent rate. This policy was met with both support and criticism, with some applauding the government’s effort to mobilize more revenue, while others argued that it would place an unfair burden on the wealthy.
president Subianto clarified in a press conference on Tuesday, December 31, 2024, that the PPN rate increase would only apply to luxury goods and services. He cited examples such as private jets, luxury yachts, and high-end lavish residences as items that would fall under this category.
Minister Gunawan expressed his confidence that this decision would alleviate citizens’ concerns and reiterated the government’s commitment to fostering a more prosperous Indonesia.
Baca Juga (Read Also):
- Sri Mulyani Issues Regulation on 12 Percent PPN for Luxury Items
- List of Goods and Services Exempt from PPN
- PPN 12% Only for Luxury Goods, PKS: Fair for Lower-Income Citizens
