Indonesia's plan to raise VAT to 12% "scrapped"

As a New Year's gift to the people for 2025, President Prabowo canceled the plan to raise the value-added tax (PPN) from 111 TP3T to 121 TP3T.After the policy adjustment, the VAT rate of 12% will be levied only on luxury goods and services consumed by the rich class, such as private airplanes, yachts, and luxury homes. On the other hand, the tax rate of 0% will be maintained for goods and services needed for the basic needs of the people, and the current rate of 11% will be applied to other non-luxury goods and services. This decision reflects the government's efforts to realize the well-being of the people and promote the development of the country, aiming to bring peace and prosperity to the people.