RI Can Produce Smartphones Comparable To Samsung Products

Jakarta, Sept 17 (Antara) - Indonesia will be able to produce cellular phones that are comparable to Samsung products as long as the government supports domestic products in adopting tax policies, said a minister. "(Indonesian cellular phones) have the ability to compete with other brands. We have PT Inti, which produces smartphones, but it is facing difficulties in expanding its business because of taxation matters," explained State-Owned Enterprises Minister Dahlan Iskan on Tuesday. He added that one of the problems faced by local companies is related to tax policies. "The imposition of taxes on industries, sometimes, makes it difficult for some industries to survive, let alone expand their businesses. We are concerned because there are several sectors that are unable to progress because of tax matters," he asserted. Citing an example, the minister said the government is planning to impose luxury goods sales tax on smartphones on grounds that about 70 million illegal smartphones are being distributed in Indonesia. According to the minister, there is a huge demand for smartphones in Indonesia, which is why the supply of illegally imported cellular phones is high too. Given the tax problems in Indonesia, it is more efficient for companies to import phones than produce their own. This applies not only to information technology industries but also other industries, including PT Boma Bisma Indra, which is hampered by import taxes, he noted. "Consequently, the import of goods, particularly small-sized goods such as cellular phones cannot be controlled and this leads to an increase in the number of smuggled goods circulating in Indonesia," added the minister. Earlier, Trade Minister Gita Wirjawan mentioned that the plan to impose luxury goods sales tax on cellular phones should be reviewed. The imposition of such a tax will increase the number of illegal goods entering the country. To prevent the circulation of illegal cellular phones in the country, the trade minister suggested the usage of the International Mobile Equipment Identity (IMEI). Based on a report published by cellular telephone operators, the IMEI approach requires time, and as such, illegal cellular phone communication networks cannot be cut off in an instant. "Many people in the community own more than two sets of cellular phones. If their connection is cut off all of a sudden because they use phones that have been imported illegally, they will be confused. So, a transitional period to undertake the IMEI approach is necessary," he said.