REPUBLIKA.CO.ID, JAKARTA -- Tax holiday should be given to the owners of small and medium enterprises (SMEs), according to senior economist Emil Salim.
"Related to tax holiday, why was it not given to SMEs? They have also been affected by the turmoil and crisis," Emil Salim stated at a national seminar titled "Economy from Time to Time" here on Monday.
Salim urged the government to consider SMEs that have proven their resilience in times of crisis as compared to the financial sector.
"SMEs can sustain the Indonesian economy during a crisis," Salim affirmed.
He suggested that financial incentives should not only be provided for big projects but also for SMEs.
Former minister of transportation recalled the importance of development in various regions of Indonesia, including in rural areas, which have poor infrastructure.
"There has been no development strategy for Indonesia in regions from Sabang to Merauke, especially in the fields of infrastructure, education, and food.
Infrastructure development is still concentrated in Java, Sumatra, and Bali," he noted.
According to Salim, the infrastructure development plan has been determined by political lobbying.
"Infrastructure development should be planned to boost connectivity between the regions," he remarked.
Earlier, the finance ministry had issued Regulation No. 159/PMK.010/2015 on exemption or cut of income tax for companies operating in the pioneer industry.
The new regulation is a revision of the Finance Minister's Regulation No. 130/PMK.011/2011 and Regulation No. 192/PMK.011/2014 on tax holiday for pioneer industries.
Pioneer industries include the upstream metal industry; oil refining industry; oil and gas based organic base chemical industry; machinery industry; agricultural, forestry, and fishery-based processing industries; telecommunications, information and communications industries; and sea transport industry, among others.
Coordinating Minister for Economy Darmin Nasution remarked that the policy package concerns the real sector, financial sector, institutional deregulation and regulation, the issuance of new policies, and tax holiday.
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