TEMPO.CO, Jakarta - The Indonesian government is officially providing incentives for the property sector until 2024. Coordinator Minister for Economic Affairs Airlangga Hartarto stated this policy has been approved by President Jokowi during a cabinet meeting today, Tuesday, Oct. 24.

Value-added tax for house or property transactions under Rp2 billion will be 100 percent covered by the government. "The 100 percent cover for value-added tax will proceed until June next year," he said during BNI Investor Daily Summit 2023 today. "So, we are hoping that the backlog for the property sector could be distributed."

Meanwhile, from June 2024 until December 2024, the government will cover 50 percent of the value-added tax of houses under Rp2 billion. The government will also support the administrative fee amounting to Rp4 million for low-income citizens until next year.

Indonesian government hopes that these two incentives will boost the housing sector growth which contracted 0.67 percent earlier.

The housing and construction sectors are contributors to 14 to 16 percent of GDP in 2023 and provide employment opportunities for 13.8 million people. Both sectors also contributed to tax amounting to 9.3 percent and local revenue amounting to 31.9 percent.

Airlangga hoped that providing incentives would reduce the social gap concerning housing with a required backlog of 12.1 million homes.

Before the cabinet meeting, President Jokowi stated that the housing incentives are provided to boost housing investment.

RIRI RAHAYU | ANTARA

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