Government Launches Incentives to Purchase Four-Wheel Electric Vehicles and Buses

By : Nata Kesuma | Thursday, April 06 2023 - 20:45 IWST

ilustration, the electric vehicle (ist)
ilustration, the electric vehicle (ist) - The government is committed to accelerating economic transformation through value added tax (VAT) incentives for purchasing four-wheeled electric vehicles and buses. 

The incentive is valid from the April tax period to the December 2023 tax period.

"This policy was launched in order to accelerate economic transformation to increase the attractiveness of investment in the electric vehicle ecosystem, expand employment opportunities, accelerate the transition from the use of fossil energy to electricity so that in the future it is hoped that it will accelerate emission reductions as well as energy subsidy efficiency," said the Head of the Policy Agency. Fiscal (BKF), Ministry of Finance (Ministry of Finance), Febrio Kacaribu, quoted on the Ministry of Finance's website, Thursday (06/04/2023).

This rule is set forth in Minister of Finance Regulation (PMK) Number 38 of 2023 concerning Value Added Tax on Delivery of Certain Four-Wheel Battery-Based Electric Motorized Vehicles and Certain Bus Battery-Based Electric Motorized Vehicles Borne by the Government for Fiscal Year 2023.

The provision of these incentives will be aimed at, firstly, four-wheeled battery-based electric motorized vehicles (KBLBB) and buses with domestic component levels (TKDN) greater than or equal to 40 percent (TKDN ≥ 40%). This will be given VAT borne by the government (DTP) of 10 percent so that the VAT that must be paid is only one percent.

Second, KBLBB with TKDN above or equal to 20 percent and below 40 percent (20% ≤ TKDN <40%). This will be given DTP VAT of 5 percent so that the VAT that must be paid is 6 percent.

Models and types of vehicles that meet TKDN requirements are stipulated by Decree of the Minister of Industry (Kepmenperin) Number 1641 of 2023. Meanwhile, the criteria for TKDN values ​​pay attention to alignment with Presidential Regulation (Perpres) Number 55 of 2019  concerning Acceleration of the Battery Electric Vehicle Program. ) for Road Transportation as well as a roadmap for the battery-based electric motor vehicle acceleration program from the Ministry of Industry (Kemenperin).

The Director General (Dirjen) of the Metal, Machinery, Transportation Equipment and Electronics (ILMATE) Industry, Ministry of Industry, Taufiek Bawazier hopes that this incentive can increase public interest in buying electric vehicles.

"With the implementation of the government-borne value-added tax facilitation program for certain four-wheeled KBLBB and certain buses, the government hopes that people's interest in buying electric vehicles will increase, and support the creation of an electric vehicle ecosystem in the country. In the early stages, it is estimated that there will be 35,862 units of electric cars and 138 units of electric buses in 2023," said Taufiek.

For the technical implementation of the tax facilitation, said Taufiek, his party will supervise the suitability of TKDN values. This supervision can be carried out by an independent verification agency appointed by the Directorate General (Ditjen) of ILMATE.

If under supervision there are KBLBB that do not meet the TKDN value, the Director General of ILMATE can provide administrative sanctions in the form of deletion from certain KBLBB lists that can take advantage of DTP VAT. 

News Comment

Today's Industry

President Jokowi Inaugurates New Army Chief

Jumat, 01 Desember 2023 - 19:13 WIB

President Jokowi Inaugurates New Army Chief

President Joko “Jokowi” Widodo on Wednesday (11/29) at the State Palace, Jakarta, inaugurated Lieutenant General Maruli Simanjuntak as Army Chief of Staff (KSAD). The appointment of Maruli…

President Jokowi Pushes for Greater Role of CFSS Amidst Rapid Global Changes

Jumat, 01 Desember 2023 - 19:10 WIB

President Jokowi Pushes for Greater Role of CFSS Amidst Rapid Global Changes

In a bid to brace for various future scenarios and to quickly respond to any changes caused by the global dynamics, President Joko “Jokowi” Widodo has called for the stronger role of the…

President Jokowi to Attend COP28 in UAE

Jumat, 01 Desember 2023 - 19:06 WIB

President Jokowi to Attend COP28 in UAE

President Joko “Jokowi” Widodo has kicked off an overseas working visit to attend the World Climate Action Summit COP28. The President arrived at Al Maktoum International Airport in Dubai,…

Indonesia Wins Awards at Gourmand Awards in Riyadh

Jumat, 01 Desember 2023 - 19:02 WIB

Indonesia Wins Awards at Gourmand Awards in Riyadh

Riyadh, Saudi Arabia - Indonesia has achieved outstanding achievement by winning two prestigious awards at the Gourmand World Cookbook Awards. These awards are part of the Saudi Feast Food Festival,…

Mary Kay Expands to Hungary, Elevating Beauty and Empowerment in Central Europe

Jumat, 01 Desember 2023 - 18:56 WIB

Mary Kay Expands to Hungary, Elevating Beauty and Empowerment in Central Europe

Mary Kay Inc., the iconic beauty brand and global advocate for women’s empowerment, is thrilled to announce its expansion into Hungary, a strategic move that marks the company's latest foray…