Thailand
Indonesia: Labors Refuse Plan to Lower Non-taxable Income
TEMPO.CO, Jakarta – Workers who are members of the Indonesian Trade Unions Confederation(KSPI) reject the government’s plan to lower the limit of non-taxable income (PTKP), arguing it will further burden of people with low-income.
KSPI President Said Iqbal said in Jakarta, Sunday that the government should focus on taxing more from big taxpayers, especially people and businesses who still owe taxes.
He argued further that the low-income workers still have lo purchasing power, thus the plan to lower the minimum PTKP will further erode their income.
“The government cannot compare with our purchasing power to other countries’ like Malaysia. The purchasing power in Indonesia is still low so the comparison is not apple to apple,” he said.
Additionally, he said that the level of income in Indonesia is still low whilst the Gini ratio is also still high.
The Finance Ministry plans to reduce the amount of PTKP as an effort to increase the tax ratio (tax revenue to GDP).
Another reason for the PTKP reduction is the fact that Indonesia’s non-taxable income at Rp4.5 million per month is far below Malaysia’s Rp1,083 million per month.
Source: https://en.tempo.co/read/news/2017/07/24/056893869/Labors-Refuse-Plan-to-Lower-Non-taxable-Income