Finance Minister Sri Mulyani Indrawati have serious talked with Chairman of Federal Reserves Jerome Powel at the G20 Ministerial and Governor Meeting in Bali (12/10) - Photo by the Committee
JAKARTA (TheInsiderStories) — Good morning! Ministry of Finance asses the possibility to scraps corporate income tax to be equal with other countries. Its expected the adjustments will become an incentive for businesses to produce export-based products.
According to the minister Sri Mulyani Indarawati, Indonesia’ corporate income tax now 25 percent, higher than neighboring countries such as Singapore (17 percent), Thailand (20 percent), Vietnam (22 percent), and Malaysia (24 percent), but lower than Philippines.
Meanwhile, Coordinating minister for Economic Darmin Nasution stated that he will improve the export growth in some sectors. For that, he said, the Government aimed to simplify the procedure, like lowered the export tariff and select flagship export commodities.
Currently, he explained, the Industry ministry identifying textile, chemical, automotive, also food and beverage sectors to get added-value. Other than that, government also support the unperformed industries, such as fisheries, woods, and simple machine.
Yesterday, Rupiah continued its strengthening, but was not as big as the day before. Rupiah against US Dollar recorded a hike by 0.52 percent to 14,031.
The raise was supported by Bank Indonesia (BI) intervention that entered Domestic Non-Deliverable Forwards (DNDF) market in the last few days. An official at Bank Indonesia, Nanang Hendarsah stated, beside DNFF, his office also made bilateral interventions through several brokers, in an effort to give Rupiah an power-up space.
But good thing not happened at the stocks market. On Tuesday (01/08), the Jakarta Composite Index dropped by 0.38 percent to 6,262.84. The slumping market was caused by local traders, as there was Rp429.99 billion (US$29.65 million) foreign net buy.
Sentiments from United States (US) and China ongoing trade talks in Beijing couldn’t support stocks market upturn. US’ President Donald Trump tweeted that the negotiation is going very well.
This hints that the both economic superpowers almost reach agreement on how to solve the tariff war. Until now, there is no detail yet about the discussion.
Moreover, global market is now waiting for Federal Open Market Committee member speaks tomorrow, that can be a clue for US further policy. The Federal Reserves (Fed) is expected to be unaggressive in increasing the rate this year.
Assuming the Fed will raise again its benchmark rate, Chairman of Indonesia’ Chamber of Commerce Rosan Roeslani predicted that BI will increasing again its 7-Day Reverse Repurchase rate by 50 basis points. For that, he said the industry has pricing in the cost in its 2019’s plan.
To help the businesses, he encouraged the government to give incentives for industry players to boost the competitiveness, such as corporate income tax cut. He expected that Indonesia’s corporate income tax can be ranged at 17-18 percent.
May you have a profitable day!
US$1: Rp14,500
Written by Linda Silaen and TIS Intelligence Team, Please Read Our Insight to Get More information about Indonesia