Govt To Issue Next Tranche Of New Economic Policies

Jakarta, Oct 16 (Antara) - Deputy finance minister Bambang Brodjonegoro said the government would come up with a new package of economic policies by the end of this month to support an earlier package of policies. "In principle, we will do it as soon as possible. By the end of October, some of the policies will be issued," he said here on Wednesday. He explained that the policy package would comprise revised tax incentives for investors such as tax holidays and tax allowances to attract investment. "The tax holiday policy would be a part of the policies to be issued this October. Also included will be a revised policy for tax on intermediate goods and revision of Government Regulation Number 52 of 2011 (on tax allowance)," he said. Finance minister Chatib Basri had said that additional package of economic policies would be released if it was deemed necessary in view of the emerging economic conditions in the weeks to come. Regarding the new measures, he said, "We will see the level of urgency required, but we have already prepared it. If required, we will come up with it," he said. The government has so far issued four packages of economic policies to improve the country`s current account situation and stabilize the Rupiah exchange rate against the US dollar. These included steps such as boosting exports and providing tax deduction in the export sector to the extent of 30 percent. Other efforts included reducing oil and gas imports and increasing the tax on imported completely built-up cars and other luxury goods to between 125 and 150 percent, from 75 percent. To deal with the situation in which exports were declining due to reduced demand from main export destination countries, the government, meanwhile, would relax minerals export quota procedures. At the same time, another package is aimed at sustaining economic growth by maintaining the budget deficit at around 2.38 percent of the GDP and increasing tax deduction for labor intensive industries. The third package is about maintaining the public�s purchasing power and keeping inflation under control. In this regard, the government would cooperate with Bank Indonesia, the central bank. The government is also committed to change the trade system of some commodities. The fourth package, meanwhile, is about efforts to accelerate investment through improving the effectiveness of the one-stop service and simplifying licensing procedures for investors. The government also plans to accelerate a revision of the list of negative investment and investment in export-oriented sectors by giving incentives and providing for renegotiation of mining working contracts.