Tax Holiday For Up To 15 Years: Finance Minister

Jakarta (Antara Bali) - Finance Minister  Bambang Brdojonegoro said the government plans to extend the validity of tax holiday to 15 years from a maximum of 10 years at present.

The government offers incentives called Tax Holiday for  big investments , labor intensive investment and investment in eastern Indonesia.

"Not more than 15 years," the minister said after attending a meeting at  the National Development Planning Board (Bappenas) here on Tuesday.

He said the relaxation is a new scheme  in addition to other flexibilities  in a draft regulation  on tax holiday.

"The regulation would be issued this year," Bambang said.

Earlier Bambang  repeatedly said the government would revise the regulation on tax holiday after tax allowance which was already revised on May 6 in 2015.

Tax holiday is an incentive for investment of at least Rp1 trillion, pioneer investment  in five sectors -- base metal industry, oil refinery, machinery , renewable energy  and communications equipment industry.

The flexibility in the new scheme of tax holiday is a government strategy to encourage investment . Earlier the government offered a new scheme on tax allowance  by abolishing minimum limit of investment,  and simpler procedure of process of incentive.

The government hopes to draw more investment that would contribute to boosting economic growth and exports.  

Based on data at the Capital Investment Coordinating Board (BKPM) implementation of investment plans so far this year reached Rp519.5 trillion  or up 14 percent  from  2014.

In five years until 2019 , BKPM set a target for investment realization at Rp3,500 trillion. (WDY)