How Many Companies Received Tax Relief?

Based on data from the Investment Coordinating Board (BKPM), the number of companies receiving tax allowances in 2016 reached 25, an increase from 15 companies the previous year and the highest in recent years. Several publicly listed companies and their subsidiaries benefited from this facility, including PT Sinar Mas Agro Resources And Technology Tbk (SMAR), PT Indah Kiat Pulp & Paper Tbk (INKP), PT Gajah Tunggal Tbk (GJTL), PT Astra Daihatsu Motor (a business unit of PT Astra International Tbk), and PT Indorama Polychem Indonesia (a subsidiary of PT Indorama Synthetics Tbk/INDR).

Tax allowance is a tax facility granted to companies, providing a maximum 30% tax deduction calculated from the amount of investment made, as well as loss compensation for a maximum of 10 years. This tax reduction is given to companies with high investment value or high export value, those capable of absorbing a large workforce, and those utilizing a high proportion of local resources.

The Ministry of Industry has requested an expansion of the tax allowance facility to several labor-intensive export-oriented industries. Minister of Industry Airlangga Hartarto stated that providing this facility is a way to stimulate industrial growth in these sectors.