Optimizing State Revenue: Trade Agreements for Import Duty Deposits

The Director General of Customs and Excise at the Ministry of Finance, Askolani, explained that 70% of all imported components could not be subject to levies because the tariff was 0%.

Thus, the customs authority only collects 30% of the total incoming imports so that the exploration of potential state revenues cannot be carried out acceleratingly. This condition also prompted the government to lower the target of total customs and excise revenue this year, which was Rp. 245 trillion, lower than last year's realization of Rp. 269 trillion. "If imports are high, of course, import duties will also be high. However, we note that our import volume is 70%, the tariff is 0% according to the trade agreement. We only collect 30% of the total imports," he said in a Working Meeting with Commission XI of the Indonesian House of Representatives. The high level of imports which is not linear with import duty receipts is reflected in the data from the Central Statistics Agency (BPS) and the Directorate General of Customs and Excise. On the other hand, the government also provides various fiscal incentives for import activities which are reflected in tax spending. Unfortunately, tax spending for import duties continues to increase. This means that the trend of increasing tax incentives provided by the fiscal authorities to facilitate the import of goods is not correlated with the contribution of the sector to state revenue. Director of the Center of Economic and Law Studies Bhima Yudhistira advised the government to review all trade agreements, especially in the context of exemption from import duties to countries that do not have a reciprocal impact. "The excessive import duty exemption model will also harm local players apart from the import duty side," he said.

|•SOURCE•| Image :KEMENKEU |

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