Jakarta, CNBC Indonesia – President Joko Widodo (Jokowi) approved the provision of tax incentives for home buyers worth less than IDR 2 billion. Namely, in the form of VAT borne by the government up to 100%.

This was stated by Coordinating Minister for the Economy Airlangga Hartarto after a limited meeting (ratas) with President Jokowi at the Presidential Palace, Tuesday (24/10/2023).

“Earlier, the President asked that a VAT program be carried out by the government for purchases of houses or property under 2 billion. This will apply to 100% VAT,” said Airlangga.

So how long will the incentives be provided?

“The VAT borne by the government for purchases of houses or property under 2 billion will apply to 100% VAT borne by the government until June next year,” he explained.

“After June, 50% will be borne by the government,” said Airlangga.

He explained that the reason the government provided these incentives was because there was a decline in GDP in the housing sector by 0.67% and construction fell by 2.7%.

In fact, the housing and construction sector contributes 14-16% to GDP, provides employment for up to 13.8 million people, and tax contributions reach 9.3% and Regional Original Income (PAD) is worth 31.9%.

[Gambas:Video CNBC]

(dce/dce)